Bankrupt Thornton & Co. Inc. (TCI; Southington, CT), a plastics distributor and brokerage firm specializing in the distribution of polymer resins, is set to be acquired by Axxom LLC (Princeton, NJ), in which Axxom will place a bid of $3.7 million on Nov. 23 when the company is up for auction at the federal courthouse in Hartford courthouse. Qualified bidders may seek to overbid the Axxom bid.
"We are gratified with the market interest in investing in TCI and very pleased that Axxom has faith in our ability to once again run a thriving business that allows us to service our valued suppliers and customers," commented Paul Thornton, TCI's founder and CEO.
If Axxom is the winning bidder, it is expected that TCI will resume normal-course resin brokerage operations as a part of Axxom.
Under the terms of the asset purchase arrangement, Axxom will acquire the inventory, PP&E, and intellectual property assets of TCI plus an "earn-out" provision for the benefit of the Chapter 11 estate. The Company's accounts receivable and other litigation assets will not be acquired by Axxom under the terms of the APA. The initial minimum overbid amount is $175,000.
TCI filed for Chapter 11 protection in Hartford, Connecticut, on Aug. 10, 2015. Thornton cited “a significant drop” in petrochemical prices in the last year as a reason for the bankruptcy filing. That drop caused his firm’s sales to fall more than 20%, he added, leading Thornton to deal with the resulting financial pressure by selling inventory on hand “at a significant loss."