peanut-processing plant at Portales, NM, has been sold to Canada’s Golden Boy Foods, a move that could restart a facility closed after a 2012 Salmonella outbreak that sickened 46 people in 20 states.Golden Boy’s winning bid came Wednesday at the second court-ordered auction held in the past week to dispose of Sunland’s physical assets. Its opening bid was a $25-million cash offer made Friday after the first auction.
North Carolina-based Hampton Farms then upped Golden Boy’s bid with an offer of $25.1 million, but that was immediately trumped by another bid of $26 million from Golden Boy, and there were no other offers.
U.S. Bankruptcy Judge for New Mexico David Thuma immediately approved the sale to Golden Boy as final for the processing plant that at one time produced more organic peanut butter than any other facility in the U.S.
Hampton Farms, the largest peanut roaster in the U.S., said it was disappointed to have come in second in the second auction for the facility.
After last week’s first auction, when Hampton Farms initially prevailed with a bid of $20.05 million, Golden Boy captured the court’s attention with its last-minute $25-million cash offer, which caused the judge to order the second auction.
Golden Boy’s late entry into the bidding means that $5.95 million more will be available to satisfy Sunland’s creditors, especially the unsecured ones.
Paul Henderson, head of Golden Boy’s nut butter business unit, was not exactly new to the proceedings. Henderson was interested in acquiring Sunland’s physical plant as soon as he heard about the bankruptcy last November. Golden Boy was then owned by Tricore Pacific Capital Inc., but was in the process of being sold to Post Holdings Inc.
As a result, Henderson could not proceed, but was told to monitor the sale proceedings. At the time, it appeared that the bankruptcy trustee was going forward with a sale of the property to California-based Ready Roast Nut Co. Henderson then learned of the auction from another Golden Boy employee, who saw a March 18, 2014, article about the auction planned for two days later.
Golden Boy’s new owners were now interested in the purchase, and Henderson, who had visited the Portales facility in late 2013, immediately tried to reach the bankruptcy trustee in Roswell. However, he couldn’t since the trustee was in Albuquerque preparing for the hearing to approve the bid from the first auction.
Golden Boy then made its $25-million cash offer on March 21, making the funds available through a local title company, and putting the judge in a position to call for the second auction.
