Bankruptcy sale of Red River Waste nears completion

Diving Brief:

  • Final project details $12.6 million The sale of Texas-based Red River Waste Solutions to private equity firm Platform Capital could occur in the coming weeks. Both parties and many creditors are aiming to resolve lingering disagreements over the terms of the final sale order at a July 13 bankruptcy hearing.
  • Presiding Judge Edward Morris urged the parties involved to “move quickly and furiously” to discuss the discrepancies to avoid further delays and lawsuits. Once the sell order is finalized, the parties plan to finalize other important details, such as Red River’s approval declaration of bankruptcy statement, at a supplementary hearing on July 21.
  • In a hearing Friday in federal bankruptcy court, most creditors verbally agreed to the details set out in the sale order. Several municipalities, equipment vendors and financial institutions are part of the ongoing bankruptcy and sale process.

Overview of the dive:

Red River’s long-running bankruptcy case had many “moving parts,” company attorney Marcus Helt said during the hearing. The sale has partially stalled through many conversations about which assets are eligible to be part of its sale to Platform Capital and under what terms. The sale of Red River has did not attract any other bidders beyond the platform auction.

At the July 8 hearing, a representative of vehicle finance companies Daimler Trust and Santander Consumer USA expressed concern that the companies’ vehicles leased from Red River were being used, maintained or insured, but overall they were satisfied with the parts of the PO that related to the companies equipment.

Representatives from Signature Financial and TBK Bank said they still had outstanding disagreements over the wording of the final sale, but intended to resolve the issues in the coming days.

Other creditors include the Metropolitan Government of Nashville and Davidson County in Tennessee, the City of Huntsville Solid Waste Disposal Authority in Alabama and Santek Waste Management Services (subsidiary of Republic Services).

Few major waste management companies have filed for bankruptcy in recent years, but Red River cited the pandemic, rising costs and falling waste volumes among the factors that led to its filing. It has been unable to provide consistent service to several local governments recently, with Fort Wayne, Indiana recently terminating its contract in favor of starting a eight-year contract with GFL Environmental in July.

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