Expertise Beyond the Numbers

破产 Sales and the Stalking Horse: Is It a Fit?

马修·J. LoCascio |本金, SC&H资本, 特殊情况 

What is a Stalking Horse?

“潜马”是一个让债权人和债务人心中充满希望,同时让其他竞标者感到恐惧的术语. When running a §363 sale process, identifying a stalking horse bidder—the bidder that submits the highest and best initial bid, which others must overbid if they want to participate—lays the groundwork for the rest of the proceedings. 跟踪出价实际上设定了资产的底价,并用来吸引其他集团支付更高的价格,最终参与拍卖.

潜猎马这个术语是一个古老的狩猎参考,指的是真正的马或猎人用来隐藏自己的猎物的道具马. The cover is used to get closer to the prey, or in this case 债务人, before striking. But do not let the origin fool you. 在破产中,跟踪马的竞标者远非隐藏,他们还被要求披露大量有关自己及其出价的信息.

When is a Stalking Horse an Appropriate Option?

选择跟踪马和签署资产购买协议(APA)的时机可能会根据卖方的策略以及它是否在积极寻求出售而有所不同, or reactively ended up there after filing chapter 11.

  • 在一般情况下, larger companies with financial runway to complete a more orderly process will try to line up a stalking horse, sign a purchase agreement, and draft bid procedures prior to filing for bankruptcy.
  • 相反, companies in the lower-middle market tend to file chapter 11 due to some emergency or impending doom, such as a foreclosure action. 通常, without bid procedures or a stalking horse bid in hand, a company may instead choose to solicit interest after filing—ideally, under the guidance of an experienced investment banker.

在这两种情况下, once in a bankruptcy proceeding, 债务人 must seek court approval of the stalking horse, the purchase agreement, and any proposed bid procedures. This generally requires giving 20-days’ notice to creditors, followed by a hearing. Parties-in-interest can object during this notice period and, 最终, 法院将决定是否指定跟踪马的名字,并给予投标人某种保护,以符合遗产的最大利益. 经常, some terms of the procedures or purchase agreement are negotiated to gain consent from any objecting parties.

What Are the Advantages of Being a Stalking Horse?

Anecdotal evidence suggests the stalking horse bidder is the winner as often as 85% of the time.

这是不寻常的跟踪马投标人得到一个领先的开始和更多的时间进行他们的勤奋相比,其他潜在投标人必须等待开始的过程,直到正式投标程序被批准. Since the stalking horse’s bid sets the floor price and establishes the terms for the APA, it then serves as the form agreement all other prospects use when submitting their bids. This can provide a significant advantage in some instances, as the stalking horse bidder can choose:

  • Which assets they want to include
  • Which liabilities they may want to assume
  • The executory contracts they are 愿意 to cure and have assigned

随后出现的任何组织基本上都必须进入该协议,尽管他们通常认为不可接受的潜在条款和条件.

在某些情况下, 跟踪马投标人也可以在谈判投标程序中发挥作用(如果没有被批准),它为竞争投标设定最后期限,并为其他投标人被认为有资格参加拍卖的遵守要求. Depending on how much of a say the stalking horse has, 制定一个简短的拍卖时间表,并在最后期限前限制其他竞标者的额外勤奋时间,可以给他们带来实质性的优势. 由于这些原因, before granting approval, 法院通常要求债务人作出陈述,说明潜在的骚扰不会对程序的起草产生不当影响.

最后, stalking horse bidders are often incentivized with an expense reimbursement and/or break-up fee to encourage a bid submission. 分手费通常是提议收购价格的2%到3%,如果跟踪者准备好了,这笔费用就会支付给它, 愿意, and able to close but gets outbid. It is important to note that, 作为最佳实践, 债务人应编写程序,使费用报销和/或分手费的支付只发生在竞争投标被接受和关闭时, providing proceeds to cover the fee. 也就是说, stalking horse bidders should insist that the orders approving both the bid procedures and the ultimate sale, approve payment as a priority administrative expense of the estate to avoid the risk of it being treated as an unsecured claim. 如果法院批准从收益中支付的分手费是销售成本,那对跟踪马来说就更好了.

Why Would Groups with a Serious Interest in a Debtor Hesitate to Pursue the Position?

The stalking horse bidder will have to commit considerable time to conduct diligence, interact with ownership and employees, and negotiate purchase agreements. Since the stalking horse cannot rely on other bidders to establish the value of the assets, 它在做这些事情的时候,并不知道最终需要支付多少才能完成交易,而且还冒着出价高于资产市场价值的风险.

All of these things cost money, and the risk of uncompensated due diligence is likely the biggest concern for potential stalking horse bidders to weigh. 通常, multiple groups are vying to be the stalking horse, so just getting in a position to submit a bid for consideration requires a substantial amount of resources, and there is no guarantee they will be selected as the stalking horse and entitled to a break-up fee.

Once named the stalking horse, nothing prevents other bidders who took a wait-and-see approach from swooping in and making a topping bid. 在我们的经验, the stalking horse rarely wins with their original bid, and additional bidding is often required. 其他竞标者限制了前期成本,并依靠跟踪者对债务人进行财务和法律调查, so perhaps they are comfortable paying more. The stalking horse will be entitled to its break-up fee but may wonder if it was worth the effort.

Depending on what the bid procedures state, the stalking horse may have as few as 30 or as long as 90 days, 加上天之间, to being named the stalking horse and closing. The risks of the business deteriorating, 市场的变化, or losing a key employee, 供应商, and/or customer are all amplified for the stalking horse, as they have made a binding offer with a substantial, non-refundable deposit.

Why Might Bidders Shy Away from Bidding if There is a Stalking Horse?

Each of the advantages shared above is also a potential disadvantage for other bidders. 跟踪马的竞标者经常比其他潜在竞标者提前获得融资并申请监管部门的批准(如果需要的话), giving them a leg up. In situations where 债务人 is the proverbial 融化的冰块, the ability to limit the timing between stalking horse selection and the auction is typically supported. 这可能会产生(意想不到的)影响,将没有足够时间完成尽职调查、没有足够信心做出强有力的出价的竞标者赶出去.

Because they have often started diligence earlier than other groups, 跟踪马的竞标者可能享有优先的尽职调查请求,并与管理层和其他关键员工有内部联系, as well as customers and 供应商s and, 在适用情况下, 房东. 经验丰富的投资银行家会努力确保竞争环境是公平的,但在其他集团之前与这些方谈判的能力,可以让潜猎者更快出价,更容易看到和确定.

How do we Choose a Stalking Horse?

When selecting a stalking horse, 债务人, 它的专业人士, and creditors should weigh the impact the bid (and bidder) will have on the market and other potential prospects.

一方面, if a strategic stalking horse with substantial financial wherewithal and incentive to close the deal is selected, 其他各方可能会被劝阻,不愿在勤奋上投入时间和精力,因为他们相信,跟踪的人最终会赢得胜利.

另一方面, 选择一匹业内不知名的财务跟踪马,或者没有一个知名的名字,可能会吸引其他竞标者参与. 在某些情况下, 债权人可能更喜欢某个跟踪者,因为他们可能在调查过程中建立了关系, the expectation of continuing the business, and the known ability to close the transaction in a timely fashion.

Are You Considering Being a Stalking Horse?

Make sure you are crystal-clear on whether you can credit bid your break-up fee. The bid procedures will typically spell this out but absent that, 你需要在你的APA中确认,如果资产有拍卖,分手费将从购买价格中扣除. It is important to further clarify that the credit bid applies to all subsequent bids and not just the first overbid, 因为它是 “continuing cash credit toward any bid” and it does not matter how many rounds of bidding or how high the price goes; every bid will result in payment of the break-up fee to you.

To further avoid any ambiguity as to how the break-up fee will be handled, 确认, if there is an auction that results in a final purchase price greater than the initial stalking horse bid, the purchase price is calculated as follows: final bid less the break-up fee, and the cash required at closing is that amount less the good faith deposit already submitted.

为确保您获得分手费的信用,一个决定性的步骤是在随后的每一个出价记录中宣布,它包括X美元现金加上Y美元的分手费,总出价为Z美元.

破产, and specifically a §363 sale, is a useful tool to effectuate the acquisition of assets free and clear of existing liabilities. 考虑作为潜在投标人参与§363销售过程的任何一方都应仔细考虑作为跟踪马投标人的潜在优势是否大于潜在劣势. 有疑问时, 聘请在这个世界上有经验的法律和财务顾问,可以帮助买家在往往不确定的破产水域中航行.

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