HUNTERSVILLE, N.C. — A bankruptcy judge has postponed until February a hearing on the sale of American Tire Distributors Inc.'s assets to a group of lenders.
A hearing in U.S. Bankruptcy Court for the District of Delaware had been scheduled for Jan. 16 to approve the deal.
Days earlier, ATD cancelled the planned Jan. 13 auction of its assets after not receiving any qualified bids. That allowed the company to proceed with the "stalking horse" asset purchase it arranged in November with a group of lenders.
A stalking horse purchase agreement generally sets a minimum price for a company's assets and is used as the starting bid in a court-ordered auction. The stalking horse bidder makes a binding offer to purchase the assets, conditional on the company not getting a better offer.
A stalking horse asset purchase can protect a debtor from unreasonably low bids. A stalking horse bidder is offered incentives, such as expense reimbursements and breakup fees, to secure the deal.
Judge Craig T. Goldblatt rescheduled the hearing for Feb. 10.
"ATD and the lender group are committed to completing our transaction and beginning ATD's next phase as a stronger business with a focused core value proposition as a wholesale distributor," ATD said. "
We are rescheduling the hearing at which we will seek Court approval of the transaction, which will allow us additional time to provide notice of the hearing to all of our creditors. We remain on track to complete the ownership transition as planned. In the meantime, the teams across our organization remain focused on supporting our manufacturer partners and customers as usual and providing the outstanding levels of service they expect from us."
ATD, the largest independent wholesale tire distributor in the U.S. with 2023 sales of $5.7 billion, previously identified the lenders as Guggenheim Partners Investment Management, L.L.C.; KKR, Monarch Alternative Capital L.P.; Sculptor Capital Management Inc.; and Silver Point Capital, L.P. They are collectively called the Ad Hoc Lender group.
