FTX's new stewards are keen to sell four connected companies, including its Japanese and European operations, as the company enters the second month in bankruptcy.
FTX is requesting authorization to begin bids for LedgerX, a cryptocurrency derivatives exchange, and Embed, a clearing broker-dealer, along with FTX Japan and FTX Europe, in a petition filed in Delaware on Thursday.
The goal of FTX's new management was to "maximize recoverable value for stakeholders" by conducting a comprehensive evaluation of the company's global assets.
In the petition, it is stated that "The Debtors [FTX] believe that a number of these firms have solvent financial sheets, independent management, and valuable franchises."
Lawyers claim that the companies are still governed and authorized in the US. The US division of FTX acquired LedgerX in August and Embed in June. The petition stated that the four firms that are up for sale have all kept separate customer accounts.
One of the main causes of FTX's collapse is said to have been the fraudulent commingling of user funds; according to Reuters, CEO Sam Bankman-Fried secretly transferred $10 billion in customer funds from FTX to sister trading company Alameda over time to mask its losses.
Each business' potential sale procedure is, therefore, less complex because its activities are generally separate from the debtors' core business operations.
FTX wants to liquidate businesses while they're still worthwhile.
According to attorneys from Sullivan & Cromwell, each company that is for sale has experienced regulatory pressures, which justifies the necessity for a rapid selling procedure. Additionally, they have lost both clients and staff.
The license of FTX Europe has been revoked, and the operation of its Japanese subsidiary has been put on hold.
The damage to the value of the assets and the risk of licenses being permanently revoked is greater the longer operations are paused, lawyers warned.
The opening dates for preliminary bids are set between January 18 and February 1 in the event that the court approves the sale. Dates for the sale hearings would go through March 27.
FTX further disclosed that, 111 parties have expressed interest in possibly buying one or more of the firms. The company intends to launch a marketing campaign with help from investment banker Perella Weinberg, which is anticipated to generate many offers. Dec. 29 is the deadline for objections to the motion, and Jan. 11 is the date for the hearing.
