Hereford Biofuels' $25 million asset sale receives court approval

By Caroline Salls

Pittsburgh, April 27 - Hereford Biofuels, LP received court approval of the $25 million sale of substantially all of its assets to its senior secured lenders through acquisition entity Ethanol Acquisition, LLC, according to a Monday filing with the U.S. Bankruptcy Court for the Northern District of Texas.

Ethanol Acquisition will also assume some of the company's liabilities.

As previously reported, Hereford Acquisition, LLC, an affiliate of Panda Energy International, Inc., was the stalking horse bidder with a $10 million offer. Panda Energy is the majority shareholder of Hereford Biofuels parent Panda Ethanol, Inc.

Under the bid procedures approved in February, Hereford agreed to pay the Panda Energy affiliate a $300,000 break-up fee if it was not the high bidder for the assets and reimburse up to $350,000 of its sale-related expenses.

Dallas-based Panda Ethanol, Inc. develops ethanol fuel plants. Its Hereford subsidiaries filed bankruptcy on Jan. 29. Their Chapter 11 cases are being administered under case number 09-30453.

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