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Levitt and Sons' administrator for Wachovia debtors granted court OK to offer 2.5% break-up fee
By Jennifer Lanning Drey
Portland, Ore., June 16 - Levitt and Sons, LLC's chief administrator for some of its debtors was granted court approval to pay a 2.5% break-up fee under a sale of the debtors' assets, according to a Monday filing with the U.S. Bankruptcy Court for the Southern District of Florida.
When requesting the approval, the administrator said the break-up fee is intended to give interested parties an incentive to bid.
As previously reported, Soneet R. Kapila, chief administrator of Levitt and Sons of Horry County, LLC, Levitt and Sons of Hall County, LLC, Levitt and Sons of Cherokee County, LLC, Levitt and Sons of Paulding County, LLC, Levitt and Sons at World Golf Village, LLC and Levitt and Sons of Manatee County, LLC, also known as the Wachovia debtors, is responsible for the management and/or sale of the debtors' real estate projects.
According to the motion for approval, Kapila and the Wachovia debtors need to secure court approval to offer a break-up fee before they seek approval of a sale because many potential stalking horse bidders would not enter into a purchase agreement until they were first assured that they would be reimbursed for their due diligence and other costs and expenses.
Kapila said the promise of a break-up fee would induce bids that may not otherwise have been made and enable the Wachovia debtors to obtain the best purchase price for any assets they attempt to sell.
Levitt and Sons, a Fort Lauderdale, Fla.-based homebuilding subsidiary of Levitt Corp., filed for bankruptcy on Nov. 9, 2007. Its Chapter 11 case number is 07-19845.
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