California firm submits winning bid for E. Millinocket mill at $5.4 million

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BANGOR — Hackman Capital Partners, a California firm, submitted the winning bid of $5.4 million in a public auction of the shuttered Great Northern Paper mill in East Millinocket held Tuesday morning at the historic Penobscot County Courthouse.

Founded in 1986 and headquartered in Los Angeles, Hackman Capital is a privately held, asset-based investment firm that focuses on the acquisition of industrial real estate and the purchase and sale of industrial equipment, according to information on its website.

U.S. Bankruptcy Judge Louis Kornreich is scheduled to accept or reject the bid at 1 p.m. Tuesday.

Five entities bid on the mill — GNP Acquisition LLC, which submitted the stalking horse bid of $2.6 million, AIM, Mac-Butler, Hackman Capital and Maybid LLC.

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Bidding began at $2.9 million but the final two bidders were Hackman Capital and GNP Acquisition, which has been running the wastewater treatment plant, that also serves the town, and doing routine maintenance to keep pipes from freezing.

Stalking horse is the term for a bidder who is chosen before an actual auction to ensure there’s a starting bid and a willing buyer if no better bids are received. An online search revealed that one of the principals who signed the asset-purchase agreement on behalf of GNP Acquisition, William Firestone, is president of Capital Recovery Group, an auction and appraisal firm, according to its website, crgauction.com.

The final round of bidding was between Hackman Capital and GNP Acquisition. The stalking horse bidder had agreed to continue to operate the wastewater treatment plant for six months but Hackman did not.

Town officials have expressed concern about the expense of creating a new wastewater treatment facility separate from the mill operation.

The mill is owned by two separate entities, both of which have filed for Chapter 7 bankruptcy.

GNP East Inc. owns the land and buildings at the shuttered mill. GNP Maine Holdings LLC owns the mill’s papermaking equipment.

The bid process approved last month required potential buyers to submit a minimum bid of $2.9 million — to surpass the stalking horse bid — and provide a $500,000 deposit Monday. Another provision requires that the successful bidder close the deal on Thursday.

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