A bidding war of sorts Wednesday (May 13) in U.S. Bankruptcy Court in Riverside, Calif., netted Riverside-based Fleetwood Enterprises Inc. a slight premium for its defunct travel trailer plant in La Grande, Ore.
Judge Meredith Jury approved the sale of Fleetwood’s plant to Northwood Manufacturing, a 15-year-old company based in La Grande that has 400 employees. Northwood paid $2.05 million for the plant.
Arbutus RV and Marine Sales Ltd., a British Columbia-based retailer, had initially offered $1.8 million for the facility. Arbutus, a Fleetwood retailer that would have had to find someone to run the manufacturing operation, raised its offer to $2 million, but the judge ruled Northwood the winner, according to the Riverside Press-Enterprise.
Fleetwood, which filed for Chapter 11 bankruptcy protection in March, is selling off some of its assets to raise enough money to help it continue to operate without accepting an $80 million debtor-in-possession financing plan from Bank of America. Fleetwood hopes a buyer for the entire company can be found while it continues to operate, according to the newspaper.
The judge also approved the sale of equipment in Fleetwood’s Mexicali, Mexico, travel trailer plant to Krystal Enterprises LLC of Brea, Calif., for about $150,000. Krystal manufactures high-end Class B and C motorhomes,stretch limousines and midsize luxury buses.
Fleetwood opened the Mexicali plant, its first foreign operation, in 2007. Craig Millet, Fleetwood’s bankruptcy attorney, told the court he offered to show others the factory but there were no takers.
“The market is extremely thin for this equipment,” Millet said.
Bank of America must still agree to Fleetwood’s financing plan, but approval of that was continued until May 26.