Orleans Homebuilders is reconsidering its plans to sell off most of the companys assets through a bankruptcy auction.
The company adjourned a court hearing scheduled for May 4 that would have, among other things, set bidding procedures for the auction, it announced.
The principal reason for the adjournment is to afford the company more time to consider other options for the company, including ongoing discussions with the companys senior secured lender group, the official committee of unsecured creditors, and other constituencies regarding a standalone plan of reorganization as opposed to a prompt sale, a news release said.
The company has been in active dialogue with a number of parties regarding strategic options, said Mitchell B. Arden, who has been serving as restructuring officer for the Bensalem, Pa.-based company, in the news release. The conversations have been productive, and the two-week adjournment is designed to provide additional time to consider these options.
Earlier, the company had planned to auction off almost all of its assets in late June. NVR was the stalking horse bidder, offering $170 million for the companys 4,300 lots in its 11 divisions in eight states, primarily in the Mid-Atlantic.
A bidder other than NVR would have to make a minimum bid of $178 million that would include a breakup fee to NVR.
It was clear from the beginning that NVR wasnt the only suitor for Orleans land. The company said in its bankruptcy filing that it had obtained a nonbinding letter of intent to sell the company to an unidentified buyer prior to the filing. That buyer is reputed to be Toll Brothers.
Orleans operates in southeastern Pennsylvania; central and southern New Jersey; Orange County, N.Y.; Charlotte, Raleigh, and Greensboro, N.C. (with some South Carolina communities); Richmond and Tidewater, Va.; Chicago; and Orlando, Fla.