Farmland won't cover cost for refinery shopper - Kansas City Business Journal:

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operation. , an equity investmeny firm based inCos Cob, Conn., approached the Kansa City-based cooperative two weeksd ago saying it was interested in biddintg on the operation, which includes a fertilizer plant and a petroleum The firm's letter of inteny requested a 45-day "exclusivity period," during which Pegasuse could study the plant and be firs t in bidding on the site. Such a bid wouled then kick off apotential auction.
Farmland, which has spenr months unsuccessfully marketing the property as part of itsbankruptcy proceedings, agreed to offset the firm's costs of investigating the site by But the court-appointed committee of unsecured creditors objected to the payment, worrying that it might signal to otherd potential suitors that Pegasus had the insidr track on the Coffeyville property and dissuadre them from bidding. "We were concerned with makingv sure this is an open process so othert parties will come in and we can reac h thehighest price" for the plants, committee attorney Christopher Redmondf of Husch & Eppenberger LLC told U.S.
Bankruptcy Judge Jerry Venters Larry Frazen, an attornehy with Bryan Cave LLP and Farmland' lead bankruptcy lawyer, cautioned that the lette of intent did not wed Farmland to Pegasuas and that other companies could studty the plant during the exclusivity period. Frazen addec that the payment seemed reasonable because of the many environmentall and regulatory issues tied tothe site. "They'rew going to have to put in substantiao time and money to evaluatethis asset," Frazen told the In the end, however, Frazej said Pegasus was willing to do without the paymentf as long as it retained the exclusivithy period.
An attorney for Pegasus also agreec to notify Farmland and the creditodr committees if the firm lost interesgt in the deal before the 45 dayswere up, so as not to blocki the site from other bidders. Venters on Tuesday also approved the biddingy and auction procedures for Farmland to sell its porkprocessing business. Smithfield Foods Inc., based in Va., has proposed to buy the divisionmfor $363 million. Other potentia l bidders have until Sept. 12 to submit highetr offers, after which there would be an The deal must be completedby Dec. 14, Frazeb said. Farmland already has sold most of its with the Coffeyville complec its lastmajor component.
The which filed for Chapter 11 bankruptcy protection onMay 31, sold its fertilizer business in May to Koch Nitrogem of Wichita and agreed to sell its majority interest in Farmland National Beef to minoritu partner U.S. Premium Farmland officials are scheduled on Thursday to release a disclosures statement in which the company will detail its future and show how it plan to payback creditors.