Thursday, September 04, 2014

"They are arguing [the] grand bargain is a de facto asset sale, that it is mispricing the asset, and that it should not benefit only one creditor."

That's Kristi Culpepper's summary of the argument so far, and it's exactly what I predicted would happen back in June:

"The grand bargain, you'll recall, 'brings together the equivalent of $816 million from national and local foundations, the DIA and the state of Michigan to spare the museum’s collection from a possible sale.'  In essence, it's a sale of the museum's collection to a new, independent nonprofit for $816 million.  But what makes that the right number?  We know that the collection is actually worth a great deal more than thatDoesn't the existence of the grand bargain make it easier for the creditors to come in and say, "Look, everyone -- even the museum itself -- acknowledges that the art isn't really held in any sort of legally cognizable trust, it cannot simply be removed from the bankruptcy process, there has to be a price to the removal ... and this price is too low.  There are people out there who will pay twice that amount and the bankruptcy trustees have an obligation to explore those higher offers."