By Christina Calloway
PNT senior writer
In what Doug Redmond considers the “strangest bankruptcy cases” he’s ever seen, the Portales city manager said the result of the sale of Sunland Inc., is what matters most.
The fate of the defunct peanut giant’s shuttered plant remains in limbo as of Wednesday as two companies continue to battle to be Sunland’s new owner.
A federal judge approved the sale of the peanut butter plant that went bankrupt after a salmonella outbreak and nationwide recall to Canadian-based company Golden Boy Foods Ltd.’s for $26 million during an auction Wednesday — the second in a week.
Lawyers for Hampton Farms of Severn, N.C., which won a first round of bidding for the company last week, were laying the groundwork for an appeal throughout the new auction and hearing that followed.
Redmond said the concern of the community is whether the plant will reopen and restore the 100-plus jobs that were cut when the plant closed after filing for bankruptcy in October.
“As long as it remains open in Portales that’s our most important concern,” Redmond said.
Redmond said he was checking the proceedings of the bankruptcy court hourly on Wednesday, and isn’t sure why it’s taking so long to have a concrete result.
Roosevelt County Chamber of Commerce Director Karl Terry is optimistic that the proceedings will end soon and Sunland will have a new owner shortly, hopefully with the best interest of the area at heart.
“We’re moving toward a resolution,” Terry said. “We’re looking forward to jobs and getting back in force out there (at Sunland’s plant).”
Terry added that he hopes the new owners will provide area peanut farmers with the market that was once provided by Sunland. He said the larger bids will pay off a lot of local creditors.
Bankruptcy Trustee Clarke Coll said Golden Boy Foods had expressed plans to operate the plant in Portales.
Golden Boy Foods did not return requests for comment via e-mail.
At Wednesday morning’s bidding, Hampton Farms increased its offer to $25.1 million, but only after making it clear it was doing so under protest and without waiving its right to appeal the ruling that forced the second round of bidding. The hearing to approve the sale was also peppered with motions and testimony aimed at appeal.
Hampton Farms bid $20 million for the plant March 20. But just minutes before a court hearing Friday to approve the sale, Golden Boy Foods called Coll with a $25 million cash offer.
Coll on Monday asked U.S. Bankruptcy Judge David Thuma to reopen the auction, saying the extra $5 million could determine whether or not unsecured creditors get any money back in the case. Hampton Farms’ attorneys asked the judge to honor last week’s auction results, arguing it was important to preserve the integrity of the bidding process.
Thuma wrote that he was “loath to disturb the results of the judicial auction,” but that he couldn’t ignore the extra $5 million or certify the lower bid as in the best interest of creditors.
Tom Nolan, vice president of sales and marketing for Hampton Farms, said the company was “very disappointed” in the outcome.
He noted that the company followed all the rules and procedures, and had raised the offer several times throughout the process. Earlier this year, Coll had recommended Sunland be sold to Ready Roast Nut Co. of California for $18.5 million.
“Hampton Farms has been and is actively promoting and marketing U.S.-grown Valencia peanut butter, as opposed to other competitors who are marketing organic peanuts and peanut butter from China and South America at lower prices in the U.S. market,” Nolan said in an e-mail. “We feel our being awarded the assets would have been a great situation for the growers in New Mexico and Texas.”
The Associated Press contributed to this story.