RE:RE:RE:RE:RE:stalking horse bid meaning Patch
Appreciate your commentary, but I think you are a bit confused on the meaning of stalking horse. It is NOT a predatory action, but an agreed bidder that works with the sellers.
In a regular auction, there can be reserve bids, placed by the seller, and in that case if the reserve is not met, the item does not sell (or the seller buys it).
In the case of a chapter 11 auction, the seller placing a reserve bid is not an option.
That is where the stalking horse bid comes in. Someone willing to place a legitimate bid, one that meets the minimum sale requirements of the sellers, then the stalking horse bidder gets certain perks for doing so, laid out in the agreement with them. This then effectively becomes the reserve bid.
If you read this quote from early in the sale document, you will see that it must be agreeable to the sellers.
"(vi) approving the break-up fee and expense reimbursements relating to potential stalking horse bidders if the Debtors determine to enter into such an arrangement with a bidder for the Assets (the “Stalking Horse Bid Protections”);"
It is a favourable thing to have a stalking horse bid in such situations.
KW