Competing bids were submitted in a Wednesday auction for bankrupt US aluminum producer Noranda Aluminum's upstream business, including an idled smelter in Missouri, an operating alumina refinery in Louisiana and a bauxite mining operation in Jamaica, according to a court filing.
ARG International AG, a Swiss company formed several years ago by a former Glencore aluminum trader, and MFR II LLC, a company that specializes in industrial and commercial asset disposition and liquidation and served as the stalking horse bidder, submitted the only two bids.
ARG's $13.7 million offer was slightly higher than MFR's $13 million bid, Noranda attorneys told the US Bankruptcy Court for the Eastern District of Missouri in St. Louis.
Noranda spokesman John Parker, who confirmed earlier Wednesday there were two bidders, but declined to identify ARG, could not be reached for comment.
Several Noranda attorneys were also unavailable for comment.
Judge Barry Schermer is expected to decide which bidder is the winner during a sale hearing scheduled for 9:30 am CDT (1430 GMT) on Friday in St. Louis.
Until ARG's entry into the case, it appeared that at least some of Noranda's upstream assets, including the 263,000 mt/year New Madrid primary aluminum smelter in southeastern Missouri idled since mid-March, were destined for liquidation.
But ARG appears to have added a new wrinkle to the proceedings.
According to media reports, ARG was founded in 2013 by Matt Lucke, a metals trader in Zurich, Switzerland. Lucke was described as Glencore's former number two aluminum trader.
Lucke has been quoted as saying ARG initially would focus on aluminum and products along the supply chain, including bauxite, alumina, coke and caustic soda.
While the New Madrid smelter has battled profitability issues at least partly because of high electricity prices, Noranda's 1.2 million mt/year Gramercy alumina refinery in Burnside, Louisiana, is believed to be profitable.
The auction came just one day after Schermer approved MFR as the stalking horse bidder. Noranda has agreed to pay a $390,000 "break-up" fee to MFR if it does not end up with the upstream assets.
MFR, representing Capital Recovery Group LLC of Enfield, Connecticut, in the auction, has not said what it would do with the Noranda holdings.
But Capital Recovery Group says on its website it is a "recognized leader in the appraisal and disposition of industrial and commercial assets by 'walking the fine line' between our clients and customers, achieving the best possible results for our clients, while assuring good value to our customers."
Noranda, based in Franklin, Tennessee, filed for Chapter 11 bankruptcy reorganization on February 8.
