Attorney corrects Isaacson jobs claim; DES objects to sale

Isaacson Structural Steel Inc., the Berlin-based construction and supply company that was auctioned off last week for $2.4 million to several auctioneers, has a slight correction to make when asking for bankruptcy court approval.On March 1, the estate’s attorney, William Gannon, originally said that sale “represents the culmination of a great deal of effort that results in little money, but does preserve jobs in a distressed economy.”But in actuality, the company ceased operations, as those who bought it decide whether to sell the company as a whole or in pieces. Sixty employees were laid off last week, with another 40 to follow, and the New Hampshire Employment Security rapid response team is on hand doing its best to place them. So Gannon filed a correction on Tuesday, deleting the phrase about preserving jobs.On Monday, Gannon also asked for the court to pay the fees for himself and his firm: $189,471, plus $2,054 for their work from the Sept. 1 to Feb. 29. Gannon, who charges $400 an hour, is asking for $177,620 of that for himself.The court previously approved Gannon’s firm’s first application for fees (for an earlier period, when the company first filed for bankruptcy) totaling $120,721 and expenses of $1,979.Also applying for fees is Mesirow Financial Consulting LLC, which asked for $76,202 for its work on the sale.Mesirow and Gannon’s work culminated in the Feb. 29 auction of Isaacson.Three companies — Counsel RB Capital LLC of White Plains, N.Y., Myron Bowling Auctioneers of Ohio, and Hilco Industrial of Chicago — offered $2.4 million, outbidding a designated “stalking horse,” GTAuctions Inc. — also known as Investment Recovery Services — which offered $2 million.Another bidder was Koster Industries, which bid $2.3 million. Like the others, Koster is a firm specializing in auctions, liquidations and appraisals of industrial equipment.The money won’t even begin to pay off the largest secured creditor, Passumpsic Savings Bank, which claims it is owed about $12 million on the property. Passumpsic didn’t object to the sale.But the sale won’t go through without objection.On Friday, the state Department of Environmental Services objected to the sale.One of the items to be auctioned off was high-efficiency diesel equipment, purchased with a $140,500 federal economic stimulus grant. According to DES, that grant becomes repayable by the state since it wasn’t used in accordance with the terms of the grant.DES said it objects to the “shortcut” to “virtually all of the bankruptcy code’s substantive protections for creditors.”A hearing on that objection is scheduled for Thursday morning in Manchester. The hearing on Gannon’s fees is set for April 2. — BOB SANDERS/NEW HAMPSHIRE BUSINESS REVIEW