363 sale
A court-approved sale of bankruptcy-estate assets under section 363. Free-and-clear relief depends on the statutory conditions and the sale order.
Also called Section 363 sale, Asset sale in bankruptcy
363 sale in round numbers
ESL Investments bought Sears’ going-concern assets this way in 2019, credit bidding the debt it already held.
A sale may preserve going-concern value without waiting for plan confirmation. Timing depends on the case; a plan can also provide for asset sales or a reorganization.
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| Issue | Section 363 sale | Confirmed plan |
|---|---|---|
| Process | Court approval after notice and a hearing; an auction is not invariably required | Court confirmation under applicable requirements; cramdown may overcome a rejecting class |
| Assets and obligations | Defined by the transaction and sale order; free-and-clear relief is conditional | May reorganize obligations or provide for asset sales |
| Timing | Case-dependent | Case-dependent |
Source: 11 U.S.C. 363 · 11 U.S.C. 1129.
Terms Related to 363 sale
Stalking horse · Credit bid · Chapter 11 bankruptcy · Loan-to-own · Absolute priority rule · All of the glossary