HOUSTON (ICIS)--A US subsidiary of Mossi & Ghisolfi (M&G) filed a motion in bankruptcy court to begin the sales process for some of its assets in the US, including its polyethylene terephthalate (PET) plants in Texas and West Virginia.
M&G did not immediately respond to a request for comment on Monday.
The motion and the proposed bidding procedures were filed on 16 November for the company's integrated PET/purified terephthalic acid (PTA) plant under construction in Corpus Christi, Texas, and its PET plant in Apple Grove, West Virginia. The sales process will also include a desalination plant associated with the Corpus Christi plant and a research and development (R&D) facility in Sharon Center, Ohio.
In the first round of the two-step marketing process, parties will submit preliminary indication of interest by 16 January 2018. The parties will then conduct due diligence before the second round begins, with final bids due by 23 February. An auction is scheduled to take place on 28 February. Finally, a hearing to approve the sale could be on 6 March.
Prior to the auction, M&G may enter into an agreement to set a floor for the bidding, also known as a stalking horse agreement.
Twelve US M&G subsidiaries filed for bankruptcy protection under Chapter 11 in October, at which time M&G said it plans to sell its Corpus Christi plant. Construction of the still-unfinished plant weighed heavily on the company as costs mounted to an estimated $2.4bn, according to court documents.
The troubles with the Corpus plant left M&G $1.7bn in debt and began to affect other areas of the business, leading the company to shut down its PET plants in Altamira, Mexico, and in Apple Grove. The company’s main PTA supplier, Alpek, halted feedstock delivery to M&G in September because of past-due payments.
The Corpus Christi plant’s planned PET capacity is 1.1m tonne/year, and planned PTA capacity is 1.3m tonne/year. The Apple Grove plant’s capacity is 360,000 tonne/year.
No plans have been announced for M&G’s plants in Altamira or Brazil. Alpek was working with M&G to restart the 560,000 tonne/year Mexican plant in late November.
Major producers of US PET are Indorama, DAK, Nan Ya and Mossi & Ghisolfi.
M&G filed for bankruptcy protection in US Bankruptcy Court, Delaware District. The case number is 17-12307.