The recent sale of the New Energy ethanol plant to a pair of liquidation companies may not go through.
Last Tuesday, the city of South Bend held an auction and sold the plant to a team of two liquidation companies. Natural Chem, which lost in the bidding war, says it will file a motion for consideration on Monday to void the sale.
Natural Chem claims that the two companies violated bankruptcy rules by teaming up in the middle of the process. They are arguing that any joint bids should have been arranged before the auction began.
The city also tried to intervene with the sale, hoping that an operator would purchase the plant instead of a liquidator.
Homeowners living in the area around the plant have been complaining of flooding damage since the plant closed and stopped pumping water out of the ground. The liquidation companies will likely sell off New Energy’s assets instead of turning the plant back on, leaving the groundwater issue unresolved.