{"id":414476,"date":"2024-10-08T14:00:00","date_gmt":"2024-10-08T14:00:00","guid":{"rendered":"https:\/\/www.saipantribune.com\/?p=414476"},"modified":"-0001-11-30T00:00:00","modified_gmt":"-0001-11-29T14:00:00","slug":"Bankruptcy-court-denies-IPI-s-proposed-bid-procedure-for-sale-of-its-properties","status":"publish","type":"post","link":"https:\/\/www.saipantribune.com\/index.php\/Bankruptcy-court-denies-IPI-s-proposed-bid-procedure-for-sale-of-its-properties\/","title":{"rendered":"Bankruptcy court denies IPI’s proposed bid procedure for sale of its properties"},"content":{"rendered":"

The NMI bankruptcy court has denied Imperial Pacific International (CNMI) LLC\u2019s proposed bid procedure for the sale of its properties (which includes the hotel\/casino). Instead, the court granted the committee of IPI creditors\u2019 request to employ Intrepid Investment Bankers LLC as an investment banker to market IPI\u2019s properties in hopes of upping the sale price.<\/p>\n

Last week, U.S. District Court for the NMI Chief Judge Ramona V. Manglona, following an over four-hour long hearing, denied IPI\u2019s motion to approve bid procedures for sale of substantially all of the debtor\u2019s assets and related relief. In addition, Manglona denied IPI\u2019s application to employ Keen-Summit Capital Partners LLC to market IPI\u2019s property.<\/p>\n

However, Manglona granted the motion filed by the Official Committee of General Unsecured Creditors to employ Intrepid Investment Bankers as investment banker to market IPI\u2019s properties finding that it would be in the best interest of the estate.<\/p>\n

Last month, in an attempt to identify more potential buyers and possibly up the sale price of IPI\u2019s casino\/hotel and other properties, IPI creditors filed a motion to hire Intrepid Investment Bankers to market IPI\u2019s properties as a holistic business instead of real estate property.<\/p>\n

According to the committee\u2019s request, to identify potential buyers overlooked by the debtor\u2019s limited marketing process (IPI is currently only marketing its properties as real estate), it is essential for the committee to retain proposed investment banker Intrepid Bankers.<\/p>\n

\u201cThe investment banker will bring the necessary expertise and industry connections to market the business effectively as a holistic business. Should this approach not succeed, the real estate broker proposed by the debtor can then proceed with a real estate sale. This comprehensive and strategic asset disposition plan will benefit both the estate and creditors. Intrepid has been informed and understands that no sale may be consummated until after all creditors and parties in interest have received notice of the pending sale and have had an opportunity for a hearing before the United States Bankruptcy Court,\u201d said the committee\u2019s request.<\/p>\n

IPI\u2019s primary real estate assets include a hotel building currently under construction with a casino, a leasehold interest in approximately 19,204 square meters of land leased from the DPL under Lease Agreement No. LA-15-002S, and IPI\u2019s ownership interest in Imperial Pacific Properties, LLC, which holds a leasehold interest in eight lots adjacent to the leasehold property.<\/p>\n

According to the motion, on Aug. 10, 2024, IPI filed a motion to approve bid procedures for the sale of substantially all of the debtor\u2019s assets and related relief to essentially liquidate its assets.<\/p>\n

Last Sept. 5, the committee filed an opposition to the Bid Procedures Motion, which states that the committee has identified an investment banker to facilitate a sale of IPI\u2019s assets as a holistic business and will file an application before the hearing on the Bid Procedures Motion.<\/p>\n

Subsequently, on Sept. 6, 2024, IPI submitted its application to employ Keen-Summit Capital Partners as its real estate brokers.<\/p>\n

The broker application sought to employ Keen-Summit Capital Partners as the real estate broker to market IPI\u2019s assets.<\/p>\n

Notably, the Bid Procedures Motion explicitly excludes the casino license from the assets and IPI has confirmed it only intends to market the assets as a real estate sale, said the committee<\/p>\n

\u201cAlthough the CCC has stated that a casino license will not be granted to the debtor or parties connected to the debtor, it has expressed a willingness to work with disinterested bidders for granting a casino license. By treating the assets merely as real estate, the debtor deters potential buyers in the gaming and gambling industry from submitting bids, thereby missing opportunities to capture the cumulative value of the assets as a casino hotel,\u201d the committee explains.<\/p>\n

To avoid suboptimal outcomes and to maximize the value of the estate\u2019s assets, the committee argues that the assets must be market tested as a casino\/hotel business.<\/p>\n

\u201cThis comprehensive approach alerts potential buyers of the opportunity to purchase the casino license and operating the property as a casino, thereby enhancing the estate\u2019s overall value. The committee owes a fiduciary duty to the creditors and is thus obligated to explore this option to ensure the best possible financial recovery,\u201d said the committee.<\/p>\n

IPI obtained its exclusive casino license for the island of Saipan and opened its operations in 2014. IPI\u2019s casino is primarily situated on property leased from the Department of Public Land.<\/p>\n

The COVID-19 pandemic forced the closure of IPI\u2019s operations in March 2020.<\/p>\n

In April 2021, IPI\u2019s casino license was suspended by the Commonwealth Casino Commission for nonpayment of fees and other alleged monetary defaults.<\/p>\n

<\/p>\n

The U.S. District Court for the NMI in Gualo Rai.<\/p>\n

-KIMBERLY B. ESMORES
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