Nassau Broadcasting headed for the auction block
Four months after convincing US Bankruptcy Judge Kevin Gross to convert the Chapter 7 liquidation case filed by its creditors to Chapter 11 reorganization, Nassau Broadcasting Partners has opted to liquidate itself. It has asked Judge Gross to approve an auction of its 49 radio stations to take place next month.
After conferring with its financial advisor and investment banker, Rothschild Inc., Nassau has decided not to go the usual course of having a “stalking horse” bidder, with other potential buyers having to beat that bid. Rather, the company is seeking one or more qualified bids for the assets in an open auction proceeding.
Nassau and its subsidiaries propose to “seek offers for the purchase of substantially all of their Assets, or clusters of the Debtors’ radio station assets, utilized in the ordinary course operation of their business (or any portion thereof), including the Debtors’ radio broadcast licenses, radio tower leases, intellectual property, interests in executory contracts and leases, and any other business assets necessary for the operation of their radio stations. The Debtors propose to sell the Assets to the highest or otherwise best bidder at Auction. The Proposed Sale will be on an ‘as is,’ ‘where is,’ and ‘with all faults’ basis.”
The broadcaster, headed by Lou Mercatanti since 1986, owed nearly $284 million to its senior lenders, Goldman Sachs Lending Partners LLC, Fortress Credit Opportunities I LP and P.E. Capital LLC, when the bankruptcy proceeding began. “Credit bidding” by the lenders will be allowed under the proposed auction rules, should they choose to enter the bidding. The winning bidder(s) will also assume up to $2 million in trade debt accrued in the ordinary course of business by Nassau’s operation of its radio stations.
Potential bidders have to contact Nassau’s bankruptcy attorneys at Pepper Hamilton LLP in Philadelphia or Wilmington, DE for a copy of the proposed purchase agreement. They then have to submit the required documentation of their bid and financial qualifications to Pepper Hamilton and to Rothschild in New York.
If Judge Gross approves the proposed timetable, bids will be due May 1st. An auction among the bidders, if needed, will take place May 8th and a court hearing to approve the sale on May 11th.
RBR-TVBR observation: This is moving fast. However, we understand that Goldman Sachs had already located potential buyers for most of the stations last year before settlement talks with Mercatanti broke down.
Filed Under Radio News