Bankruptcy Asset Sales: Benefits and Challenges in the Age of Covid-19
Author: Deborah Kovsky-Apap.; Hugh McDonald.
Source: Volume 36, Number 06, June 2020 , pp.67-71(5)
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Abstract:
As the pandemic has forced many companies into bankruptcy, section 363 asset sales have surged as a preferred option for monetizing the debtor’s assets in a reorganization. In this article, the authors discuss various legal issues surrounding such sales, including the standard for judicial approval of such transactions, the contours of “free and clear” for asset sales, and stalking horse bid protections. They then turn to credit bidding and the assumption/assignment of contracts. They close with the special difficulties raised by the COVID-19 pandemic.Keywords: Debtor-in-Possession Asset Sales under 11 U.S.C. § 363; Covid-19
Affiliations:
1: Pepper Hamilton LLP; 2: Troutman Sanders LLP.