Search
Close this search box.

Agriprocessors Auction Collapses


rubashkin2.gifPostville, IA – Attempts to sell machinery, land and other property from Postville’s debt-riddled kosher meat plant collapsed Tuesday after potential buyers failed to make an offer that satisfied the plant’s two largest creditors.

A spokesman for the slaughterhouse’s court-appointed trustee said talks would continue behind the scenes, with a possible deal emerging by next week.

But the stalemate could threaten the future of Agriprocessors Inc. if no buyer emerges to help finance the operation.

Dan Childers, a lawyer who represents trustee Joseph Sarachek, suggested earlier in the day that the talks might lead to higher bids. The Cedar Rapids lawyer told U.S.

Bankruptcy Judge Paul Kilburg that Sarachek wanted to explore “additional avenues” for the property at stake, “which could lead to better bids.”

The top offer to buy the plant’s assets reached $15.7 million on Tuesday — nearly three times higher than Monday’s bids, but still far short of the $40 million offered by an Israeli company in January.

Such avenues, in theory, could include additional buyers or a revised deal between one of the current bidders and the plant’s creditors.

Childers did not elaborate, and declined to comment after the hearing.

Sarachek fought to reach a deal with an effort “above and beyond what we expected they’d be able to do,” said Lloyd Palans, a lawyer for the St. Louis-based First Bank Business Capital. But Palans said the progress still had not satisfied his bank.

The $15.7 million offer by Kosher Standards would give $13.5 million to the plant’s two main creditors, First Bank Business Capital and MLIC Asset Holding, an affiliate of Metropolitan Life Insurance. Both creditors blocked the sale on Monday because they were not satisfied with the bids.

A spokesman for the Orthodox Union, a Jewish outreach group, said he had not heard of Kosher Standards.

The remaining $2.2 million would buy out all of the plant’s existing leases. Under the proposal, Kosher Standards would pay $500,000 if its representatives decided to back out of the deal.

Agriprocessors filed for Chapter 11 bankruptcy in November and reported debts to nearly 400 people, businesses and organizations. Nearly 120 are based in Iowa and vary in size.

Creditors who did not secure their loans, including many small businesses in Postville, cannot seek reimbursement for unpaid debt because of the plant’s bankruptcy protection.

Agriprocessors still owes Bodley Equipment & Repair in Postville a few thousand dollars for machinery, said owner Craig Bodley.

Bodley said he doubted he would recoup any lost payments.

“It’s tough,” he said. “Not much you can do, except bite the bullet. We’re all kind of wondering what’s going to happen with the plant.”

(Source: Des Moines Register)



6 Responses

  1. 1. Demand for meat is declining due to the economy. It is a bad time to try to sell a meat factory.

    2. Given the treatment Rubashkins received from the locals, no kosher company will be interested in going to Iowa. They are better off staying closer to their markets (even if over-regulated states such as New York and Illinois), or moving south to follow their unskilled workers.

  2. akuperma (#3) – What are you talking about? Agriprocessors was by far the largest employer in Postville, and the locals were hurt more than any other group. They were not outspoken critics of the company until they lost their jobs because of the Agriprocessor’s illegal shananigans.

    Somewhere along the line I hope you Rubashkin apologists face up to this: at this point it simply ignores reality to assert that they did not commit conscious immigration fraud, rather openly, I might add, and on a large scale. This ignores neither the burden of the government to prove guilt beyond a reasonable doubt, nor our obligation as Yidden to assist Rubashkin in his defense – but to ignore reality is, frankly, stupid at best – and serves no one.

  3. Wolffman (#5) – Practically every store on 13th ave 16th ave 18th ave. Ave J, Ave M, and allover Lakewood employees illegals. Are you saying we should have them all apologies as well. Lets face it we all make the best business decisions and part of that is reducing the costs so that consumers, like you, will shop in our stores because we offer you the lowest pricing since we keep our overhead down. If you think meat was/is expensive, think how much you would be screaming highway robbery if we hired US citizens at top dollar

Leave a Reply


Popular Posts