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ARTICLE · 28 APRIL 2025

Section 363 Sales Considerations

Mayer Brown
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Distressed entities seeking to sell assets often encounter commercial and legal challenges related to existing claims or resistant constituents.

United StatesInsolvency/Bankruptcy/Re-Structuring
Jamie R. Netznik
Jamie R. Netznik
Megan O'Connor
Megan O'Connor
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Distressed entities seeking to sell assets often encounter commercial and legal challenges related to existing claims or resistant constituents. One possible solution to those challenges is to sell assets in bankruptcy through a "363" sale process. Section 363 of the US Bankruptcy Code allows a debtor, following notice and a hearing, to "use, sell, or lease" its property outside of the ordinary course of business. The section 363 sale process is fairly flexible, and allows debtors to sell assets (including their entire business through a sale of all or substantially all their assets) efficiently at any time during a bankruptcy case.

Benefits & Advantages

Open Process/Competitive Bidding: Section 363 sales are typically conducted through an open, competitive marketing and auction process that aims to attract as many potential purchasers as possible, generate competition and maximize the value of the assets to be sold. Section 363 sales often include an initial

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