New York: A federal bankruptcy judge ordered the reopening of the auction for the assets of instant camera maker Polaroid Corp, giving the two leading bidders until Tuesday to resubmit bids, a lawyer for Polaroid confirmed on Monday.
A joint venture between Toronto-based Hilco Consumer Capital and Boston-based Gordon Brothers Group LLC, and New York private equity firm Patriarch Partners will each submit one final bid, the lawyer, George Singer, told Reuters.
Polaroid, which filed for bankruptcy in December 2008, will have to announce a winner no later than Wednesday, before an approval hearing set for the following day in US bankruptcy court in St. Paul, Minnesota.
Last week, Patriarch won the auction with a $59.1 million bid over Hilco-Gordon Brothers’ $61.5 million bid, which included less cash but a larger stake in the company that would be created from the Polaroid assets being bought.
“It’s only fair because we had the higher bid,” Hilco Consumer Capital Chief Executive James Salter told Reuters, in reference to the reopening of the auction.
Salter said if the Hilco-Gordon wins the auction, it will license out Polaroid’s intellectual property and maintain the Polaroid brand name.
In a statement last week, Patriarch Chief Executive Lynn Tilton said the firm would “continue rebuilding the brand.”
Patriarch, whose portfolio includes Arizona brand iced tea and mapmaker Rand McNally, also beat out rivals Ritchie Capital Management and Luxembourg-based Genii Capital, which had placed the starting bid of $42 million.
But a committee of Polaroid’s creditors objected to the results and asked the court to reopen bidding. The creditors said in a court filing last week that more bidding would help “arrive at the truly highest and best offer.”
Singer said he hoped the auction’s extension would resolve those objections.
Hilco submitted joint bids with Gordon Brothers for three of the last five bankruptcy auctions it has won, including electronics retailer The Sharper Image, and housewares retailer Bombay Brands, Salter said.
A spokesman for Patriarch did not return calls for comment.