American Candy’s fate still uncertainPublished 12:00am Monday, June 17, 2002
Selma’s American Candy Co. and Bank of America, wrangled in the midst of bankruptcy proceedings, released no formal agreement before the close of work Friday.
According to U.S. Bankruptcy Judge Margaret Mahoney’s office, no settlement has been presented to the court. Initially, the court said an agreement would be presented last Tuesday. That never happened and the court will determine next week whether to set a deadline or hold a new hearing.
Meanwhile, The Times-Journal reported Friday that one company out of Paducah, Ky., has made an offer to purchase American Candy. Gaylon Warrington, CEO of the Selma company, confirmed to Selma Mayor James Perkins Jr. that he had heard about the offer. However, Warrington said it was not an offer they wanted to consider.
Perkins mailed a copy of the Kentucky company’s letter of intent to Mahoney on Thursday. Mahoney’s office verified that they have received the letter.
Although Bank of America and American Candy are in negotiations, Mahoney does have the authority to reject the deal made between the two parties.
Mahoney’s office said the judge could weigh the offer made by James Lacy, who owns the candy company in Kentucky.
There is no certain timetable when American Candy and Bank of America must reach a final agreement.
American Candy filed under Chapter 11 of the Federal Bankruptcy laws on June 29, 2001. At the time, Warrington said the move would help his company regroup and become profitable again.
Nearly a year later, things have not changed for the candy company.
On May 23, American Candy executives &045;&045; unable to secure financing for the company &045;&045; sent employees home and said they would return to work on June 3. That return never happened, and many employees have remained out of work since then.