In a dramatic turnaround, a bankruptcy judge indicated on 14 October 2005 he would approve the sale of Glass Group Inc.“s Flat River Glass plant to Gujarat Glass Ltd. of India for approximately USD 1…
In a dramatic turnaround, a bankruptcy judge indicated on 14 October 2005 he would approve the sale of Glass Group Inc.“s Flat River Glass plant to Gujarat Glass Ltd. of India for approximately USD 18 million. As well as the Missouri facility, Gujarat Glass will obtain operations in Mays Landing and Williamstown, New Jersey, from Glass Group, a New Jersey container glass manufacturer, which is in Chapter 11 bankruptcy. The bankruptcy court had previously approved the sale of the same plants to Stlzle-Oberglas AG of Austria for about USD 14.1 million. However, on 14 October 2005, U.S. Bankruptcy Judge Peter Walsh said he was likely to vacate the sale to Stlzle and approve the sale to Gujarat Glass instead, after reviewing final papers on the move. The judge said he made a “mistake” on 7 October 2005 when he approved the sale to Stlzle after Gujarat Glass unexpectedly made an offer that was USD 4 million higher. In making that 7 October ruling, the judge deferred to the United Steelworkers of America. The union had ratified a deal with Stlzle but said it did not know enough about Gujarat Glass to support the bid from the Indian company. “I concluded that I had made a mistake by giving the steelworkers union a veto, and I“m going to rectify that mistake,” Walsh said 14 October 2005, indicating he was ready to approve the sale to Gujarat Glass instead of to Stlzle. Stlzle will collect a USD 423,000 breakup fee, following the loss to Gujarat Glass. In the days following the approval of the sale to Stlzle, Glass Group“s creditors asked the court to look again at the Gujarat Glass“ offer and the Indian company continued talks with the unions. Hours before the 14 October sale hearing, Gujarat Glass and the steelworkers union reached an accord that will go before the Missouri membership for ratification during the week commencing 17 October 2005. About 530 jobs are involved in the Flat River Glass sale. Earlier, the Glass, Molders, Pottery, Plastics & Allied Workers International Union reached agreement with Gujarat Glass. The official committee of unsecured creditors said the extra money in the Gujarat Glass deal is expected to provide some recovery to unsecured creditors. A unit of the Piramal Group, Gujarat Glass said in court papers that it wants to increase US manufacturing capacity to satisfy clients like Revlon, Estee Lauder and L“Oreal. Earlier in the bankruptcy case, Glass Group sold its core Millville, New Jersey, facility and a stake in a lucrative Chinese joint venture to Gerresheimer Group of Germany for USD 20 million.