This post is reprinted with the permission of the Taxpayer's Channel in Greenwood.
UMB Bank was the highest bidder for the assets of Express Grain at the bankruptcy auction held Friday morning, according to multiple individuals who observed the auction.
The UMB Bank bid was close to $26 million for substantially all the Express Grain assets.
Normally, a creditor such as UMB Bank will only bid for bankruptcy assets when it believes that the other bids are lower than the potential resale value of the property.
According to the bankruptcy court docket, the court approved the sale of the assets at yesterday afternoon's hearing, but the court has not publicly stated the identity of the purchaser, or what the exact purchase amount is.
According to witnesses, Farmers Grain, Roebuck Landing Grain Terminal, and Thoroughbred AgriFuel Holdings all placed bids, but in the end, UMB Bank outbid them all by almost $5 million.
As reported by The Taxpayers Channel yesterday, the court excluded all members of the press from both the auction and the hearing afterwards. See our reporting here: Press excluded from Express Grain auction and sale hearing
If the $26 million bid made by UMB Bank was approved by the court, it is a crushing blow to those who held out hopes that the farmers would be made whole.
Express Grain owes at least $165 million to its creditors, with around $100 million in secured and priority debt. See our reporting here: Express Grain owes $60 million more than first believed to its creditors
Thus, even given the projected $57.5 million in money the court has sequestered for payment of creditors, there won't be enough to cover the secured creditors' debts, much less the $41 million owed the farmers, and the multi-millions owed to other creditors including MDA, various taxing entities, local utility and gas vendors, and many others.
In the end, it looks like Express Grain was very much over-valued as far as its assets are concerned.
18 comments:
I'm confused. If the bank is already holding the note, why would the bank have to purchase the assets? Seems the note-holder would already own the assets when the note defaults.
If the bank lends me money to buy a truck with the truck as collateral and I don't pay the notes, does the bank have to BUY my truck?
For those not in the know - you'd better believe that the judiciary is part of the organized crime syndicate that is Mississippi. Connect the dots. It's fun!
Then wink, nod, and smile.
@1:57 AM
If you don’t like the way we do things on the ‘Sip Plantation, then don’t let the door hitya on the way out okay buddy.
@11:45, the bank does not have to buy your truck, but it does have to sell it and apply the money to the debt. The bank does not automatically own it just because you defaulted. The bank can buy the truck itself using the debt it's owed as currency. If you owe $25k on the truck, the bank can bid $20k, in which case your debt is now $5k. It's called credit bidding and the bankruptcy code specifically guarantees secured creditors the right to credit bid on their collateral. But if UMB's liens are later invalidated, the bank is going to have to stroke a check for the purchase price.
1:57 a.m. put your tinfoil hat back on before secret government radio waves penetrate that extra thick scull and extra small brain of yours. Go back to making anti-vaccine posters and investigating stolen elections.
1:57, I suggest you not rush to blame your own lack of knowledge and understanding on some vague, broad-ranging criminal conspiracy.
express grain was overvalued?
where have i heard that before?...........oh yeah, some outfit called world comm.
Delivering a full years worth of hard work to a grain elevator on credit? Is that really the way it works? If so, farmers need to change their business practices. If an elevator doesn't have enough credit to pay on delivery, go somewhere else. I don't know the answer should there not be any other place to take your grain. Sounds like a lot of misplaced trust to me.
Taking control of any part the nation’s food supply for such a small price is a bargain right now. You people can’t even imagine how much these assets will be worth when the food shortages start in a few months. And the federal government will be handing out money to anyone aiding in the food security of the homeland. People in the know, already know. Cooking oil shortages have already started. I have secure 300 gallons of peanut oil for my stockpile.
The way it was explained to me, the practice exists to take advantage of market fluctuations.
In MOST such matters, the bank (which held the note)gets the assets and MOST, if not ALL of the priceIT bid.
In THIS case the bank is not iut ANYTHING
AMEN 10:13.
If you pay a note.... IT'S NOT YOURS.
If you hoard 300gallons of peanut oil for your consumption and not on a cooking team or a business, your days on this earth will be shorter than most. I bet 99% of the world doesn't even use 50 gallons in their lifetime. But you do you Cardiac King!
If the grain immediately becomes the property of the grain elevator upon delivery and prior to payment, there is a serious problem with that business model. I don't trade grain futures but I would think if that's what the farmer was doing, then why can't they just pay a storage fee to the elevator and retain ownership. From what I understand from past news, the farmers who delivered the grain are screwed. I am I missing something here?
KF could ou do some research on whether there are any Delta banks who may be in a financial strain because of Express Grain.
6:22 - STOP right there! You've never heard of a bank in financial strain. Meanwhile, they continue to buy every down-town and city corner-lot in every town in this state.
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