Sourcing

KBC Moves to Block Exelco Sale to SimplexDiam

SourcingDec 05, 2017

KBC Moves to Block Exelco Sale to SimplexDiam

It’s the latest twist in a bankruptcy case the presiding judge has described as “a mess.”

Wilmington, Del.--KBC Bank NV wants a U.S. bankruptcy court to stop Exelco North America Inc. from selling its assets to a liquidation company, the latest court filing in this complicated bankruptcy case shows.

On Nov. 28, Exelco North America, along with Exelco NV, FTK Worldwide Manufacturing BVBA and Ideal Diamond Trading USA and Ideal Diamond Trading Ltd., told the court that it had found a stalking horse bidder in SimplexDiam Inc., which has agreed to purchase Exelco’s assets for $6 million.

On Monday, KBC moved to block the potential sale for a laundry list of reasons laid out in court documents: the issue of proper jurisdiction for the case (United States or Belgium) hasn’t been resolved, the company’s value isn’t being maximized, and, moreover, it’s not even 100 percent clear what exactly Exelco is selling to SimplexDiam.

Regarding value specifically, KBC states in court papers that the $6 million being offered is less than half what the bank is owed ($13.8 million) and “significantly” less than the nominal amount of accounts receivables pledged to KBC, which total more than $8 million.

KBC said that Exelco is attempting to “put the cart before the horse” by rushing this sale process, despite the fact that they have not identified any “melting-ice issues” that warrant its acceleration.

“Marketing, bidding, auction and sale of the debtor’s assets should be conducted, if at all, only after these critical issues are determined,” court papers state.

Exelco’s attorney, Michael Nestor, did not respond to request for comment on Monday’s filing.

Exelco NV and FTK Worldwide Manufacturing BVBA, along with U.S.-based affiliates Exelco North America and Ideal Diamond Trading USA, filed for Chapter 11 bankruptcy protection in U.S. Bankruptcy Court for the District of Delaware at the end of September.

Since then, there has been much back and forth between the diamond company and its lender over issues of jurisdictions and ownership of assets, prompting U.S. Bankruptcy Judge Kevin Gross to call the case a “mess” in court on Oct. 23, Law360 reported.

Jean-Paul Tolkowsky, a member of the famous diamond-cutting family, started Exelco in 1993 with Leon and Lior Kunstler.

The company is a mid-stream supplier of diamonds, buying rough from miners and then cutting, polishing and/or setting the stones and selling them to retail jewelers.

Michelle Graffis the editor-in-chief at National Jeweler, directing the publication’s coverage both online and in print.

The Latest

MajorsNov 29, 2021
Here’s a Peek at David Yurman’s Holiday Windows

It’s a wintry wonderland in New York City.

SurveysNov 29, 2021
Survey: Jewelry, Watch Purchases Are Up in 2021

Here’s what else Provoke Insights found in its latest consumer study.

FinancialsNov 29, 2021
WatchBox Secures $165M in Expansion Funding

The pre-owned luxury watch platform also welcomed new members to its board.

Brought to you by
Train Your Staff Today with Interactive eLearning

Join the prestigious brands, industry organizations and sellers using IGI’s educational services.

GradingNov 29, 2021
BIJC, GIA to Offer Distance Learning Scholarships

They will cover the cost of earning a GIA Graduate Gemologist diploma for two students.

Weekly QuizNov 23, 2021
This Week's Quiz
Test your knowledge of jewelry news from the week of Nov. 22-26, 2021.
Take the Quiz
MajorsNov 24, 2021
Here Are This Year’s Black Friday Jewelry, Watch Deals

From Amazon to Zales, several retailers have deals lined up for the shopping holiday.

MajorsNov 24, 2021
Former JCK Associate Publisher Donna Borrelli Dies

The longtime industry veteran had a breakthrough case of COVID-19.

Brought to you by
3 Tips For Entering the Estate Market

Generate foot traffic and expand your jewelry expertise by adding an estate assortment to your store in partnership with Windsor Jewelers, Inc.

MajorsNov 24, 2021
Samuel B Has Now Donated More Than 1M Meals to Feeding America

The company donates 10 meals to the nonprofit for every piece of jewelry it sells.

×