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Firms seek involuntary bankruptcy for Mamtek

Firms seek involuntary bankruptcy for Mamtek

December 21st, 2011 in News

MOBERLY, Mo. (AP) - A Missouri bank and four companies owed money by a failed artificial sweetener factory have gone to federal court seeking to force it into bankruptcy.

UMB Bank, which is the trustee for a $39 million municipal bond issuance used to finance the partially built facility in Moberly, joined with four other creditors to file a case against Mamtek U.S. Inc. in federal bankruptcy court in Kansas City.

The four other creditors involved in the case are Frost Electric Supply Co., headquartered in the St. Louis area; Shick USA, of Kansas City; Septagon Construction Co., of Columbia; and Faith Technologies Inc., of Kansas City.

Construction of the artificial sweetener factory halted this fall after Mamtek missed a payment to Moberly, which had issued the bonds. Moberly officials later said the city would default on the bonds.

If Mamtek is forced to involuntarily file for bankruptcy, a judge would then appoint a trustee to sell the company's assets and distribute the proceeds to its creditors. In court documents filed last week, attorneys for UMB and the four creditors said there needs to be one centralized court case for Mamtek, and they urged the court to act quickly.

"The sooner an interim trustee is appointed, the more quickly can order be maintained and stabilized regarding various competing claims, and thus maximize recovery for all creditors," according to the motion signed by Scott Goldstein and other attorneys of the firm of Spencer Fane Britt & Browne.

"The longer the project sits without action, the less valuable it will become and the more problems will occur attempting to piece the project back together (if it can be done)," the court filing said.

UMB also filed suit against Mamtek on Nov. 4 in eastern Missouri U.S. District Court, seeking over $36 million for the unpaid balance of the bonds. Mamtek has not responded to that suit.

In a notice issued last Thursday, UMB said it met with representatives from Moberly and other Missouri governmental entities in early December, and all parties are working cooperatively to find a successor for the Moberly facility. UMB said it will employ an investment banker and financial adviser within the next several weeks to help with this effort.