USA Springs auction set for July 20



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Anyone want to buy USA Springs' partially finished water bottling plant on the border of Nottingham and Barrington, along with a number of state permits they may or may not stand up to challenges from residents bent on halting its completion?It appears you may have a chance on Friday, July 20, according to the latest filings at U.S. Bankruptcy Court in Manchester.USA Springs and the court have apparently given up on a $60 million financing deal that Switzerland-based Malom Group A, which originally promised to start handing over a chunk of that cash last Halloween.But Malom has kept asking for more time, offering a series of bizarre explanations that ranged from the detention of two of the company's top executives by Swiss authorities to the difficulty it encountered in convincing potential buyers to pay millions of dollars for some dubious Brazilian notes.An increasingly skeptical USA Springs and its creditors finally proposed to auction off the business to the highest bidder, while still waiting to see if Malom would come through.On May 17, Judge J. Michael Deasy denied Malom's latest request for an extension to the end of May, saying it would, have a "chilling effect" on the bidding process. Besides Deasy said, Malom's latest assurances only indicated $6 million of funding would be available initially, as opposed to the promised $60 million. That's less than half of the $13 million and counting that Roswell Commercial Mortgage LLC, which holds the mortgage on the property, Roswell claims it is owed.Four days later, on May 21, Deasy approved bidding procedures, which should start June 1 when bid solicitation and due-diligence materials will be put in the hands of various interested parties.Those parties have until July 13 to submit a bid and some actual cash (5 percent of the bid). The hope is that during the process a "stalking horse" bidder should emerge, laying the floor for the auction.If USA Springs decides to go with another bidder, the stalking horse would be paid 3 percent, or $350,000 (whichever figure is lower) for its trouble.The actual auction will take place July 20 at 10 a.m., at the office of USA Springs's Boston-based law firm Reimer & Braunstein.But, as with anything concerning USA Springs, things are far from settled.If and when the auction goes through, there still remains the question of whether the state permits - which allow the owner of the business to withdraw about 300,000 gallons a day from the groundwater - can withstand expected legal and political challenges from such anti-USA Springs groups as Save Our Groundwater.To protect those permits through the bankruptcy, USA Springs has proposed retaining Tony Soltani, a state representative from Epsom and a municipal attorney, who has represented the company in the past. Deasy approved the retention of Soltani on Tuesday. -- BOB SANDERS/NEW HAMPSHIRE BUSINESS REVIEW

 

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