M. Fabrikant & Sons Inc. has asked a judge for permission to auction its assets, The Associated Press reports.
The New York City-based diamond wholesaler auction is planned for early May, the AP reports. The request was filed with the U.S. Bankruptcy Court in Manhattan April 17.
Under the auction plan, M. Fabrikant would sell all its assets, including inventory, accounts and intellectual property, the AP reports. It would then file a liquidation plan with the court.
Under the proposed auction rules, any stalking-horse, or lead bidder, would be offered payment for fees and costs worth up to 2 percent of the bid or $200,000, if the offer is lost at auction.
The judge overseeing the jewelry company’s bankruptcy case will decide whether to approve the rules at a hearing on Thursday.
M. Fabrikant has been under Chapter 11 bankruptcy protection since Nov. 17 after lenders “froze” its bank accounts, the AP reports. Lenders include ABN Amro Bank, Antwerpse Diamantbank, Bank of America, HSBC Bank USA, Israel Discount Bank of New York, JP Morgan Chase and Sovereign Bank. Fabrikant owed them about $161.9 million as of December.
The 112-year-old New York company is one of the world’s largest manufacturers and distributors of diamonds and gemstone jewelry.
M. Fabrikant & Sons owns 81 percent of domestic unit Fabrikant-Leer International Ltd., which is also in Chapter 11. Fabrikant directly and indirectly owns over 40 companies in 10 countries.