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The Philadelphia Energy Solutions oil refinery site will be sold for $252 million and redeveloped under a plan approved yesterday in bankruptcy court, ending months of uncertainty over whether the idled plant would be restarted, court filings show, Reuters reported. Judge Kevin Gross signed off on the PES bankruptcy agreement, filed with the United States Bankruptcy Court for the District of Delaware, a day after indicating at a public hearing that he was likely to do so. Hilco Redevelopment Partners, which becomes the new owner of the roughly 1,300-acre (526-hectare) PES refinery site as part of the plan, is expected to build warehouses and other commercial projects on the land. While Judge Gross approved the purchase and sale agreement, PES and Hilco have not yet closed on the deal. PES shut its 335,000-barrel-per-day refinery in South Philadelphia, the largest and oldest on the East Coast, and filed for chapter 11 protection after a fire destroyed a section of the plant over the summer. Read more. 

In related news, Philadelphia Energy Solutions secured approval of a debt repayment plan, but action continues in bankruptcy court as the refiner tries to collect on $1.2 billion in insurance it said was triggered by the explosion that drove it into chapter 11, WSJ Pro Bankruptcy reported. In a lawsuit filed on Wednesday targeting a group of insurance carriers, Philadelphia Energy said its insurance companies’ attitude has been so “miserly” that they suggested that the oil refiner made money as a result of a June explosion that destroyed much of the facility. The incident put the Philadelphia refinery out of business, leading the company to file for chapter 11 with its future uncertain. Philadelphia Energy said it has $1.2 billion in coverage for property damage and business interruption losses but has received only $65 million. The company said that it has made clear to the insurers that its losses approach and will likely exceed the $1.2 billion in protection it paid for. Read more.

A federal judge yesterday said that he was prepared to approve Philadelphia Energy Solutions’ bankruptcy plan which includes the sale of the largest East Coast oil refinery to a Chicago real estate developer for $252 million, Reuters reported. The refinery, which had capacity to process 335,000 barrels of crude oil per day into gasoline and other energy products, has been closed since June after a major fire. It would be permanently shuttered and redeveloped for warehouses under the bankruptcy plan. Bankruptcy Judge Kevin Gross delayed his confirmation of the plan until today to allow himself and stakeholders time to review the details. But Judge Gross said in a hearing yesterday that he was likely to approve the proposal. As part of the agreement, Chicago-based Hilco Redevelopment Partners will buy the more than 1,300-acre refinery site for $252 million, $12 million more than initially agreed upon.

Tough Mudder’s bankruptcy trustee is racing to save the company’s endurance event business with a sale to rival Spartan Race Inc., a deal that the company’s owners previously balked at closing, the Wall Street Journal reported. Bankruptcy trustee Derek Abbott has filed papers that say the sale to Spartan Race is market-tested and ready to go despite the refusal of owners William Dean and Guy Livingstone to follow through with it. He is asking a judge to sign off on a sale of the Tough Mudder assets to its rival, warning that the business, which shut down in December due to lack of cash, could be beyond saving if a deal takes too long. “As a result of the debtors ceasing operations, the events scheduled for the first three quarters of 2020 are no longer salvageable and will need to be canceled,” Abbott wrote in a filing on Feb. 7 with the U.S. Bankruptcy Court in Wilmington, Del. He wants to close the Spartan Race sale by the end of February. With the motto “Probably the Toughest Event on the Planet,” Tough Mudder goes city-to-city, erecting obstacle courses that draw endurance athletes to test their skills. Creditors that filed a bankruptcy petition against Tough Mudder in January are involved in building the courses, and say that they are out hundreds of thousands of dollars.

Opponents of Philadelphia Energy Solutions’ bankruptcy plan have vowed a long legal fight if a federal court this week approves a sale that would keep the largest East Coast oil refinery permanently shut while paying out bonuses to company executives, Reuters reported. A June fire at the 335,000 barrel-per-day PES refinery led the company to file for bankruptcy and shut the plant over the summer, laying off more than 1,000 workers and ending long-standing ties with dozens of businesses. The refinery endured years of financial trouble, hurt by poor access to U.S. crude oil production and heavy costs of complying with federal laws on blending biofuels with gasoline. The PES plan to exit bankruptcy includes a $240 million sale of the refinery to a real estate developer, Hilco Redevelopment Partners. The U.S. Bankruptcy Court for the District of Delaware is scheduled to consider the plan today. Former contractors and worker unions, who are among the long list of unsecured creditors in the case, want the refinery to reopen. Even if the court approves the deal, they are asking the decision to be put on hold pending an appeal, court filings show.

Valeritas Holdings, a New Jersey-based company that makes insulin pumps, said that it filed for chapter 11 protection, Beckers Hospital Review reported. Zealand Pharma, a Denmark-based drugmaker, will acquire "substantially all" of Valeritas' assets for $23 million, according to a news release. Valeritas manufactures the V-Go wearable insulin delivery device. The company said it will continue operations as normal during the transaction with Zealand.

Forever 21 Inc. is moving forward with a sale to a group of buyers that includes Simon Property Group Inc. after no rival bidders qualified to challenge the offer, according to court filings, the Wall Street Journal reported. A group made up of Forever 21’s biggest landlords — Simon and Brookfield Property Partners LP — along with Authentic Brands Group LLC, a brand licensing firm, has offered $81 million for the bankrupt fast-fashion retailer. Forever 21 said on Sunday that it was scrapping a planned auction for yesterday after it didn’t receive any other qualified offers. The landlord takeover is similar to Simon Property’s acquisition of mall-based retailer Aéropostale Inc. in 2016. In that sale, the real-estate investment trust teamed with Authentic Brands and General Growth Properties on the deal.

Federal environmental regulators have joined a parade of parties staking claims on the bankrupt Philadelphia Energy Solutions refining complex, whose sale and reorganization are in the final, frantic stages of negotiation before a scheduled confirmation hearing next week, the Philadelphia Inquirer reported. The U.S. Environmental Protection Agency on Tuesday filed a “protective objection” to assure that the reorganization plan contains language that adequately protects the government’s interests. Its filing is primarily aimed at preserving EPA’s claims for millions of dollars of unpaid renewable energy credits that it says PES owes the government. The plan that PES submitted to the court last month poses an “unacceptable risk” that the refinery’s obligations to pay for ethanol credits, known as Renewable Identification Numbers, or RINs, will go unpaid before the company’s assets are liquidated. About ten parties have so far submitted objections to the reorganization plan, complicating a final resolution. Many of the objections are efforts by parties to get priority over claimants when the refinery’s assets are divvied up. A confirmation hearing was pushed back to Feb. 12 before Bankruptcy Judge Kevin Gross in Wilmington, Del.

A hearing to finalize Philadelphia Energy Solution’s bankruptcy plan and consummate a sale of the company’s refinery to a real estate developer was pushed back on Tuesday along with a deadline for objections to the deal, according to federal court filings, Reuters reported. The plan is now scheduled to go before the U.S. Bankruptcy Court for the District of Delaware to be finalized on Feb. 12 instead of Thursday. The deadline for objections was extended two days to Wednesday. No official reason was given for the rescheduling and PES did not immediately respond to requests for comment. PES last month entered into an agreement to sell its refinery, the largest and oldest on the East Coast, to Chicago-based Hilco Redevelopment Partners, which is expected to use the site largely for warehousing. Los Angeles developer, Industrial Realty Group, was selected as a backup buyer. Several groups, including the union that provided hundreds of workers to the plant, have objected to the bankruptcy plan, citing lacking information about how PES would settle all of its debts. The U.S. Trustee has also objected saying in a filing PES cannot release itself from its more than $1 billion in debts and other obligations under the plan because it will be liquidating its assets instead of restructuring or selling its business.

A group including two of Forever 21 Inc.’s biggest landlords has offered to buy the bankrupt retailer for $81 million, a fraction of what the international fashion pioneer was once worth, Bloomberg News reported. The consortium of Simon Property Group Inc., Brookfield Property Partners LP and Authentic Brands Group LLC is seeking to buy substantially all of the company’s assets, according to documents filed Sunday in federal bankruptcy court. The stalking-horse bid sets a minimum price for a proposed auction later this month. If no other bidders step forward, the consortium would be declared the winner. Plans envision an auction process with a sale hearing requested for Feb. 4 and approval of the winner no later than Feb. 11. The buyers have the right to close and wind down certain stores and conduct going-out-of-business sales, according to the new filing. They’re also entitled to a $4.65 million break-up fee under some circumstances if the sale isn’t completed.

The Trump administration is voicing support for keeping oil refining operations at a Philadelphia Energy Solutions site that could soon be sold in bankruptcy court to a new owner expected to turn the property into a mixed-use development, the Wall Street Journal reported. The oil refiner filed for bankruptcy last year just weeks after explosions at the 1,300-acre plant on the outskirts of downtown Philadelphia rocked nearby homes. Peter Navarro, director of the White House Office of Trade and Manufacturing Policy, said that he would “love” the property to remain a refinery. He said that he has met with more than a dozen representatives from groups that include the Laborers’ District Council, the Ironworkers, International Brotherhood of Electrical Workers Local 98, Steamfitters Local 420, Boilermakers Local 13 and Philadelphia Council AFL-CIO, as well as union lobbyists. Representatives from those groups want to keep the site as a refinery. Philadelphia Energy said days after the June 21 fire and explosion that it would shut down its refinery after more than 150 years of operation. The facility had about 1,000 employees. The company said it would sell its assets. Hilco Redevelopment Partners has agreed to pay $240 million to acquire the site.