Beef plant escrow fund offer filed again

Farm Forum

White Oak Global Advisors has again filed a motion to set aside money to pay two Northern Beef Packers lien-holders as work to finalize the sale of the plant progresses.

Under the new motion, White Oak would place $4.35 million in an escrow account. That money would be used to pay whatever is determined to be owed to Scott Olson Digging and $1.04 million in past due property taxes to Brown County, according to the request. Scott Olson Digging, of Huron, is no longer in business. The contractor did dirt work during early plant construction, and the two sides still don’t agree how much is owed for the work. White Oak is willing to put $3.31 million in the escrow account for Scott Olson Digging until a final total owed is set, according to paperwork filed last week.

The judge in the bankruptcy case denied a similar motion late last month, though it contained several other requests that are not included in the new motion. Breaking up the motion was something federal bankruptcy Judge Charles Nail suggested.

California-based White Oak, Northern Beef’s prime creditor, submitted the top bid to buy the plant at a bankruptcy action last month in Sioux Falls. It’s $44.35 million bid included $39.5 million in credit from it lending Northern Beef tens of millions of dollars in 2012 and $4.8 million in cash for Scott Olson Digging, Brown County and for other expenses.

The amount owed to the contractor is a major issue why the sale to White Oak has yet to be finalized.

Last month, White Oak filed a motion to extend the closing date of the sale, something to which an attorney for Scott Olson Digging has objected. A telephonic hearing on the request is set for Jan. 9.

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