The potential sale of nearly all Briggs & Stratton Corp. assets to New York-based KPS Capital Partners moved closer to reality Monday as the company cancelled its auction planned for Tuesday.
When the Wauwatosa-based maker of small engines, lawn and garden equipment and other products filed for Chapter 11 bankruptcy in mid-June, the company announced an agreement for KPS to buy nearly all its assets for $550 million.
KPS had also reached an agreement with members of the United Steelworkers union representing around 300 employees in the Milwaukee area. However, the deal also ended health and life insurance benefits for Briggs retirees.
The offer served as the stalking horse bidder for Briggs’ court-supervised sale process, which included an Aug. 28 deadline for qualified bids.
Potential bids needed to exceed the $550 million bid to qualify. Bids could be for portions of Briggs, but would have needed to be combined with other bids to exceed the KPS offer.
Briggs’ bankruptcy plans faced objections from a number of corners, including a group holding a portion of $195 million in notes set to mature in December. That looming debt maturity kicked of a series of events leading to Briggs filing for bankruptcy.
Other objections came from the official creditors committee and Generac Power Systems. The objections centered on the quick moving timeline for the sale of Briggs, KPS’ role financing Briggs’ continuing operations, how partial bids would be treated and whether the company was marketed extensively enough prior to the bankruptcy filing.
A Missouri bankruptcy judge, however,
sided with the company in mid-August and approved the company’s bid procedures and timeline.
On Monday, Briggs notified the court it had not received any other qualifying bids and would be cancelling its auction.
The development sets up a sale hearing on Sept. 15 where a court could approve the sale of Briggs to KPS. Objections to the sale are due by 5 p.m. Sept 9.
