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Bob Bennett, owner of Burger King restaurants throughout northwest Ohio, appears to be the highest bidder to buy Tony Packo's Inc., court filings show.
However, an offer submitted by an investor group that includes Tony Packo III, the restaurant chain's executive vice president, seems to be in the running.
Mr. Bennett, chairman of Bennett Management Corp. in Toledo, submitted an offer of $4.8 million for the assets of Tony Packo's, according to Skutch Co. Ltd., a court-appointed receiver in the Tony Packo's case.
In a statement to The Blade, Mr. Bennett said he would add to the chain's restaurants in the region.
Skutch detailed the bidders and their purchase offers in a filing submitted late yesterday in Lucas County Common Pleas Court.
Mr. Packo III joined with the restaurant-owning Mancy family and two other investors to offer at least $2.8 million for the East Toledo business.
In the filing, the receiver called the offers from Mr. Bennett and Mr. Packo "competitive" and said they have financial backing but are "structured differently so a side-by-side comparison is not appropriate."
Three other bidders for Tony Packo's were identified in Skutch's filing. They include Robin Horvath, a Packo family member and chief operating officer of the company; businessman and race car team owner Ron Hemelgarn, and Rich Iott, the owner of now-defunct Seaway Food Town Inc. and a one-time Republican congressional candidate.
The receiver was expected to recommend one of the bids for approval by Judge Gene Zmuda. However, he held off on choosing an offer in yesterday's filing, saying that the bids needed "further investigation and input from the secured creditor[s]."
Steve Skutch of Skutch Co. and his attorney declined to comment yesterday. Bidders have until Monday to submit responses to Mr. Skutch's report. A hearing in the case is scheduled for 1:30 p.m. Sept. 22.
Tony Packo's, a restaurant known for its Hungarian hot dogs and special chili sauce, is being sold to collect on more than $2.6 million in loans it owes to Fifth Third Bank. The restaurant business defaulted on the loan last year. The company also owes $650,300 to the U.S. Small Business Administration, Skutch's filing shows.
The Fifth Third default took place after Mr. Horvath sued in July, 2010, to take control of the company from Mr. Packo III and Tony Packo, Jr., the company's president. Mr. Horvath owns 50 percent of the firm; the Packos jointly own the other half. The business, which has been in receivership during most of the dispute, has kept operating.
Tony Packo's includes five Toledo-area restaurants and a distribution division that sells Packo-branded food in stores nationwide, among other affiliated business units. Mr. Skutch said in yesterday's filing that he has weighed the current owners' interest in "preserving the family heritage" of Tony Packo's.
Mr. Bennett's bid, submitted under the name TP Foods LLC, seeks to buy such assets as the company's real estate, signed hot dog buns at the restaurant's original Front Street location, and all ownership rights to the company's recipes.
In a statement to The Blade, Mr. Bennett said he aims to "keep the Packo's brand anchored in Toledo and eventually open casual-style restaurants throughout this region. The brand's long-standing history proves that, with appropriate leadership, Tony Packo's can once again be a successful business."
Mr. Bennett's company owns 26 Burger King restaurants in Ohio, Michigan, and Indiana.
Mr. Packo III's bid, submitted under the name Front Ballpark Operations LLC, includes offers to assume the restaurant chain's debt, as well as provide other unspecified money toward company assets. Front Ballpark's investors also include Gus Mancy, president of Mancy's Inc., former local bowling alley owner Darrell Ducat, and Huntington Insurance executive Mario Procaccini.
A bid submitted by Front Ballpark in December would have Mr. Packo owning 2 percent of the company and Mr. Mancy owning 49 percent, with Mr. Ducat and Mr. Procaccini owning the remaining 49 percent. Under the terms of that bid, Mr. Packo III would have the right to buy out Mr. Ducat's and Mr. Procaccini's shares during the next five years, and then would own a majority of the business.
Mr. Packo III declined to tell The Blade yesterday whether the ownership structure proposed in December remains valid. President Tony Packo Jr., is not listed as an investor in Front Ballpark, but Mr. Packo III said his father "will be a key component moving forward" in the business.
He said the Front Ballpark "is very similar dollar for dollar to the TP Foods offer" when considering various criteria.
Mr. Horvath, who owns 50 percent of Tony Packo's now, submitted a bid with his wife, Terry Horvath, of $4 million, under the name Nancy Packo LLC, named after Mr. Horvath's late mother. Skutch Co. said the Horvaths' offer included a $50,000 deposit and "may be competitive," but noted that the bid was submitted after the deadline for offers on Aug. 26 and "has not included confirmation of financing to support its offered price."
Skutch said Judge Zmuda will need to determine whether the Horvath offer is competitive if financing is obtained.
Mr. Horvath's attorney declined comment yesterday.
Skutch Co. said the remaining two bids for Tony Packo's are not competitive because the prices would not pay off the debt to Fifth Third, and do not provide funding for the SBA loan or unsecured debts owed by Tony Packo's.
One of those bids was submitted by Mr. Hemelgarn under the name B.R.A.G. Enterprises Inc. The receiver said Mr. Hemelgarn's bid, worth $2.5 million, was similar to other offers for Tony Packo's, but asked for "no disruption by present owners or management."
Mr. Hemelgarn, who owns 21st Century Super Fitness Center in North Toledo and Hemelgarn Racing Inc., told The Blade that he owns restaurants, but declined to disclose their names or locations.
"This is just basically to save Packo's, if they can't work out their problems, the family," Mr. Hemelgarn said of his offer. "It'd be a shame to see it go away."
TP Acquisition Co. LLC, which includes Mr. Iott, offered $1.875 million. Other investors in the group include Mark Katko, who distributes a salsa nationally in partnership with Mr. Iott, and Tony Pi.
Mr. Iott could not be reached for comment yesterday.
Contact Sheena Harrison at: firstname.lastname@example.org or 419-724-6103.