New Nirvana sale scheduled Friday in court
Published Nov 19, 2015 at 4:00pm
BOONVILLE — Bids to buy spring water bottler Nirvana, Inc., either as a going concern or on a piecemeal basis, have been rejected by the U.S. Bankruptcy Court. But that doesn’t mean the tap is being turned off on the operation.
As a result, another sale will be held Friday at the court in Utica, said Camille W. Hill, attorney for Nirvana. The first auction was Nov. 12 and lasted about three hours with numerous breaks so the participants could confer.
A hearing before Judge Diane Davis was then held Tuesday to review the offers; in the end, not one was accepted. Thus, the 70 Nirvana workers were left without a clear answer as to whether their jobs will continue as the end-of-year holidays approach.
“Everyone is starting from scratch again on Friday,” said Hill.
The company is still operating, but is apparently running short of cash, according to documents filed with the Bankruptcy Court.
Prior to the Nov. 12 auction New Jersey-based SNG Beverage Group had submitted an offer of $7,350,000 to buy the entire business. It was acceptable to Nirvana. This figure was later lowered to $6,250,000 to reflect adjustments based on inventory and accounts receivable.
The offer was contingent on two conditions being satisfied by Nirvana. However, the water bottler could not provide satisfactory assurances that it wouldn’t shut down before the sale to SNG went through the court and that the 2014 tax returns would be filed.
SNG did offer to provide Nirvana with financing on terms in order for the company to remain open pending completion of the sale. The proposal was not accepted by Nirvana or senior secured creditors.
“SNG continues to extend its offer to provide financing to permit the debtors’ to have sufficient funds to consummate the sale,” wrote the company in a filing submitted to the court Monday — the day before the hearing by the judge. “SNG implores the debtors and senior secured lenders to find a way to keep the debtors’ company operational until such a going concern sale can be completed, and, respectfully, seeks the court’s assistance in helping the parties to find a way to keep the debtors’ company operational to complete the sale.”
There were no qualifying offers besides the one from SNG to buy Nirvana as a going concern. There were, however, bidders interested in buying only Nirvana’s land or equipment.
Keen-Summit Capital Partners, LLC, acting as a broker for Nirvana, told the court that 19 parties visited the Route 12 Nirvana facilities and met with management and Keen representatives. A total of 154 prospects initially contacted Keen for information.
Nirvana and three affiliates filed for Chapter 11 bankruptcy protection in June. Information submitted to the Bankruptcy Court estimated both assets and liabilities to be between $10 million to $50 million.
The company told the state Labor Department in August that it intended to lay off its 70 employees between Nov. 16 and 30.