The buyer is…
The process works like this.
1. The court must accept the trustee's request to sell.
2. The US Attorney must vet and clear the buyer.
3. The court must approve the sale.
I'd guess much of that vetting has been done and, despite very real questions about Friedman and his business practices, the sale will probably go through.
UPDATE 6 pm CDT – Here is the Des Moines Register's story.
Note the price of the sale: Less than $10 million, plant and equipment purchased on an as is basis and, unstated but true – no money for any other creditors or the current and former employees owed millions by Agriprocessors.
Also absent from the deal is any mention of employment for members of the Rubashkin family and their cronies, which means the trustee is allowing them to stay in place, if Friedman wants them to.
I doubt the US Attorney will allow that, though.
As an aside, I heard but haven't confirmed that Chaim Abrahams, the plants former spokesperson and a nemesis to all that is fair and good, especially with regard to treatment of workers and treatment of the public radio station on whose board he illegally sat, is no longer in Agriprocessors employ.
Judge asked to OK sale of Agriprocessors
BY GRANT SCHULTE AND TONY LEYS • Des Moines Register
The court-appointed trustee of Agriprocessors Inc. in Postville asked a judge today to approve the sale of the slaughterhouse to a newly formed Iowa company that bought the debt held by the plant’s two largest creditors.
The bankruptcy trustee, Joseph Sarachek, filed a motion in U.S. bankruptcy court asking the judge to allow the sale to SHF Industries, LLC.
“It’s a firm deal,” Sarachek said in an interview.
A sale could revive the ailing kosher meat plant, which has struggled for more than a year after a May 2008 immigration raid gutted its work force. But a U.S. bankruptcy judge must still approve the deal, with the blessing of federal prosecutors who want to ensure that the ousted manager does not return to the helm.
SHF registered as a business in Iowa on May 6, 2009, according to the Secretary of State’s office. The company is owned by Hershey Friedman, the president of a Canadian plastics plant, and two other partners.
Under the deal, SHF agreed to pay an $8.5 million credit bid and accept the plant on an “as is, where is” basis that places nothing under warranty. The potential buyer also agreed to provide Sarachek with post-sale access to the plant’s books and records.
First Bank Business Capitol, the plant’s largest creditor, assigned all of its right title and interest to SHF the day the company incorporated in Iowa, according to the bankruptcy motion. One month later, MLIC Asset Holdings, sold its debt to the company.
Agriprocessors was the site of a major immigration raid that led to the arrest of 389 immigrant workers. The plant, once the nation's largest producer of kosher meats, has since struggled financially, and filed for Chapter 11 bankruptcy protection in November 2008.
Update 7:15 pm CDT – Friedman's two "partners" are his employees. One is also Friedman's son-in-law, as the AP reports:
Partners agree to buy Iowa kosher slaughterhouse
By NIGEL DUARA • AP
IOWA CITY, Iowa (AP) — The president of a Canadian plastics plant and two others filed court documents Tuesday to buy a struggling kosher slaughterhouse in northeast Iowa that was the site of a massive raid by immigration agents last year.
Bankruptcy trustee Joe Sarachek said the move should end months of uncertainty for the plant, Agriprocessors Inc., and the town of Postville. The sale would be subject to the approval of a bankruptcy court. A previous attempt to auction the plant failed three months ago.
"If no one else bids on it and the judge approves the sale, they own Agriprocessors," Sarachek said. "Other buyers are certainly free to come in and bid more."
Agriprocessors, once the nation's largest supplier of kosher meat, is the largest employer in Postville, a community that once had more than 2,000 residents but has seen its population dwindle and many businesses fail since the plant ran into trouble.
Top managers and the company were indicted months after 389 people were arrested in a May 12, 2008 immigration raid. Nearly six months later, Agriprocessors filed for bankruptcy and the court began seeking a buyer. An Israeli company came forward with a $40 million bid, but later rescinded it and the plant was put up for auction.
Sarachek said Hershey Friedman, president of Montreal-based Polystar Packaging, and two partners bought out the secured credit of two of the company's major creditors. Friedman and the other two buyers do not own any slaughterhouses in the U.S. or Canada.
The lines of credit were valued at $21 million, but Sarachek said SHF Industries paid less. The loans were a sticking point in the auction, as potential buyers could not agree with the creditors on a price. The creditors were not expected to get back the entire sums of the loans, and most of the auction process was spent determining what buyers would pay for them.
Sarachek did not disclose how much SHF Industries paid for the lines of credit, but said the company can be valued at slightly more than $25 million.
Sarachek said the two other partners, Daniel Hirsch and Mitch Kirschner, work in Friedman's U.S. operations. Sarachek said Hirsh is Friedman's son-in-law. Telephone messages left for Friedman and Kirschner were not immediately returned. No listing for Hirsh could be found.
Friedman is listed as president of Polystar Packaging and another plastics manufacturer in Brooklyn, N.Y., called Favorite Plastics. Polystar was founded in 1963 and employs 75 people, according to a Canadian government Web site.
The pending sale would include all of Agriprocessors' assets in New York, Florida and Iowa, which so far have served as collateral for the two loans. Sarachek said any equipment that was leased by the company would have to be negotiated after the sale. A date hasn't been set for the bankruptcy court to consider the sale.
Kevin Huntsman, a vice president and plastics specialist at Kansas City-based commodities consulting firm Mastio and Co., said it would make sense for Friedman to buy the meatpacking plant, as Polystar Packaging is one of the top 15 manufacturers of meat and poultry packaging.
Another Agriprocessors asset, the Local Pride meatpacking plant in Gordon, Neb., is not a part of the sale and will be sold separately.