The Supreme Court allowed a further round of bids for the assets of Buzreel Limited after concluding that the earlier court-ordered process had not produced an unimpeachable final result. In that appeal round, Demirca Limited offered significantly more than Midland Web Printing Limited, and the Court directed the liquidator to accept Demirca’s bid after receiving evidence that funds were available for both offers.
Buzreel, which owned the “Buy and Sell” classified advertising business, was in liquidation. The liquidator sought a rapid sale because the value of the title and related assets could fall if the magazine remained out of publication. After an initial bidding process, the High Court made a “Van Hool” order on 24 April 2014, giving Demirca and Midland a final opportunity to submit unconditional sealed bids, signed contracts and evidence of immediately available funds.
Midland’s bid was the higher of the two submitted by the deadline. But some of its cash component was delivered about 20 minutes late, and its bid included wording about obtaining clean title and acquiring the computers and software needed to run the business. Midland later agreed to delete that wording. The High Court found the bid valid and directed the liquidator to accept it. Demirca appealed.
The Supreme Court said a court should take reasonable steps to maximise the return to creditors, while also keeping faith with a court-directed sale process. It found that the order sought early finality, but did not make acceptance of the highest compliant bid automatic or limit the Court’s role to formal approval.
The Court also found deficiencies on both sides. Midland’s cash evidence was incomplete at the deadline, and the required signed contract was not provided in proper form. Demirca’s contract did not reflect its increased bid. Taken together, those issues meant the process could not be treated as having been completed in an unimpeachable way. The Court therefore reopened bidding rather than treating either earlier bid as binding.
At the further round on 5 June 2014, the Court gave both bidders a final opportunity to bid and required evidence that funds were available. The liquidator told the Court that the evidence for both bids was satisfactory. Because Demirca’s bid was significantly higher, the Court directed the liquidator to accept it. The judgment, delivered on 16 July 2014, explains the reasons for those decisions.