Peach business that is bankrupt Prima Wawona is being liquidated due to not receiving a large enough price from its auction procedure. The company has decided to sell off its major farm equipment and eliminating the entirety of its workforce.

The company applied in Chapter 11 bankruptcy last October four years ago, following the acquisition of Gerawan Packing to become the most prolific peach grower in the United States. It was awarded an offer for credit of $275 million in the month of September, but didn’t proceed with the bid. In the wake of announcing plans for liquidation the company, members of the Official Committee of Unsecured Creditors who were appointed to review the matter made an objection to the proposal, saying that liquidation could benefit the insiders at the company.

Auction procedure

The lawyer representing the Prima Wawona lending company informed the bankruptcy court the company participated in an auction, but didn’t receive an auction bid which the company wanted. This forced lenders to decide that the value of liquidation for the business is greater than its current value, which led to a decision to liquidate. Employees were given 60 days’ notices of end of service.

Prima Wawona has nearly 13,500 acres of land that it is planning to sell. Based on the presentation prepared by Pearson Realty on behalf of the lender Wawona Farm Co. LLC. The final price determined for the land was $370 million.

Source: The San Joaquin Valley Sun