Low interest in Mamtek leftovers at Mo. auction
Wednesday, October 24, 2012
ALAN SCHER ZAGIER
MOBERLY, Mo. (AP) — An auction of assets left over from Moberly’s failed artificial sweetener factory drew curious onlookers and piecemeal bidders Wednesday but no large company swooping in to replace a project once cast as the small city’s economic salvation.
Reporters and curiosity seekers outnumbered prospective buyers at the Mamtek U.S. Inc. auction in a Moberly hotel ballroom. More than 50 online bidders vied with the dozen-or-so who were there in the flesh.
The auction was overseen by UMB Bank, which is the trustee for investors who bought $39 million worth of industrial development bonds from the city of Moberly. The company’s financing collapsed last year after it missed a bond payment, and it soon spiraled into bankruptcy.
Former Mamtek CEO Bruce Cole faces fraud and theft charges for allegedly steering bond revenues to a sham company which then transferred money to his wife that she used to keep their Beverly Hills home out of foreclosure. The federal Securities and Exchange Commission has also sued Cole and his wife, seeking financial penalties for the alleged fraud, as have debtors.
Bank officers at the auction declined to release unofficial sales figures, but preliminary results suggest that the long line of Mamtek creditors could receive only a fraction of what they hope to recover. No one submitted a bid for the company’s real estate or its intellectual property, which includes a proprietary recipe for its sucralose sweetener.
One bidder offered $400,000 for the complete inventory of equipment, but the bid was rejected since the sale of individual items was expected to recoup more. One hour into the nearly three-hour auction, only a handful of bidders and spectators remained at the Moberly Best Western.
“Drink some more lattes and start bidding,” auctioneer Kirk Dove implored the crowd.
An official with the asset liquidation company hired by the bank to sell Mamtek’s inventory called the results “a very good return on the investment.”
“We did very well,” said George Wandachowicz, vice president of Heritage Global Partners. “We’re very happy with the results.”
A lone Moberly economic development official attended the auction, though he left the event early and without comment. In July, when the bank said it could not find a Mamtek buyer after months of fruitless searches, the city and its Industrial Development Authority issued a three-page press release criticizing the bank’s efforts to revive what was known locally as “Project Sugar.”
The project at one time held promises of more than 600 jobs and and envisioned cashing up to $17 million of state tax incentives.
Alan Scher Zagier can be reached at http://twitter.com/azagier