A group of XFL’s creditors have filed a motion attempting to stop the purchase of the XFL’s assets by the group headed by The Rock. Alpha Acquico LLC is led by Dwayne Johnson and is purchasing all the XFL’s assets for $15 million. In the agreement the group agrees to take on “certain specified liabilities,” with $8.5 million financed toward payments needed to resolve previous financial defaults.
PWInsider is reporting that Official Committee of Unsecured Creditors for Alpha Entertainment has filed a 13-page motion as of Monday afternoon asking the court to pause the sale. The motion argues that Alpha Entertainment, Vince McMahon’s company which served as the ownership company for the XFL, has an “ongoing obligation to negotiate terms with the Proposed Buyer that are most favorable to the estate and do not unduly prejudice its creditors.” It argues that the proposed sale doesn’t do that and instead “seeks to strip the estate of valuable assets for no consideration. As such, the Committee has significant concerns that the Sale contemplated with the Proposed Buyer does not satisfy the sound business purpose test, and is not in the best interests of the Debtor’s estate.”
The motion essentially argues that Alpha is selling the assets at a value below what they are worth and that the creditors could end up not receiving much if anything from the sale, and further that there are assets being sold that were not in the financial evaluation when Alpha filed for bankruptcy. It states that the creditors support the sale to Alpha Acquico in a general manner but want to be reworked to be more favorable to the creditors, and says that “in the interim, the Committee will continue to engage in good faith negotiations” with both the XFL and Alpha Acquico regarding the objections in the hopes of resolving the issue.
