Aiming to get out of its Chapter 11 bankruptcy, an auction will soon be held to sell the assets of Allens Inc., an Arkansas-based vegetable processor. Faegre Baker Daniels partner Michael Stewart, who has significant national experience in chapter 11 bankruptcies, was interviewed for a story on the sale of Allens appearing in Arkansas Business. Stewart said that he expects the trend of businesses buying other businesses out of bankruptcy to continue in the foreseeable future.
"More and more, we're seeing bankruptcy used as a forum for disposition of assets," Stewart said.
He did, however, caution the buyer to beware, as purchasing a bankrupt business can be a bargain or a nuisance for the company taking it over. "Sometimes in bankruptcy proceedings, as a buyer you can get a bargain," Stewart said. "By definition, the company is financially challenged, and because of that, it isn't in a position of strength when dealing with potential buyers."