ResCap wins court OK on operations; bidders emerge
* Bankruptcy court judge approves payments to employees
* Judge says expects sale procedures at June 18 hearing
* Berkshire Hathaway, Lone Star signal interest in assets
NEW YORK, June 12 (Reuters) - Residential Capital LLC received another round of court approvals on Tuesday that will enable it to operate in bankruptcy, while competing bidders stepped in for its mortgage loan and servicing businesses.
At a hearing in U.S. Bankruptcy Court in Manhattan, Judge Martin Glenn gave final approval to ResCap to allow it to continue paying employees and using its cash to pay other bills.
Glenn also said he still expects to be presented with ResCap's proposed procedures for the asset sales at a June 18 hearing unless the company decides to delay the request.
"I know it's a moving target because additional offers are coming in," Glenn said.
ResCap filed for bankruptcy last month with a plan in place for Nationstar Mortgage Holdings, owned by Fortress Investment Group, to make a $2.4 billion minimum offer for the mortgage servicing assets. Ally Financial, the parent company of ResCap, also agreed to buy a group of ResCap mortgage loans for $1.4 billion. Ally is not in bankruptcy.
Late on Monday, billionaire investor Warren Buffett's Berkshire Hathaway Inc and Lone Star, an investment fund, said in court papers that they would be interested in buying one or both of the businesses. Berkshire is a major creditor of ResCap.
ResCap spokeswoman Susan Fitzpatrick declined to comment on the potential new bidders, as did representatives for Ally and Nationstar. Last week, ResCap CEO Tom Marano told Reuters that other bidders were likely to emerge in the coming weeks.
During the hearing, a lawyer for ResCap's official unsecured creditors committee, Kenneth Eckstein of Kramer Levin Naftalis, described the sales situation as "extremely fluid" and said the committee would need time to consider the new offers. The committee's support is needed for the sales to move forward.
Under its current plan, ResCap has agreed to pay a $72 million breakup fee and a $10 million expense reimbursement to Nationstar if its deal does not close.
It also set a $25 million minimum bid increment for a higher bid. U.S. Trustee Tracy Hope Davis, who represents the U.S. Justice Department, objected to the bid procedures on Monday, saying they would discourage bidders.
Berkshire offered to replace Nationstar as the minimum or "stalking horse" bidder, saying it would cut the breakup fee in half and eliminate the expense reimbursement. It also said it would top Ally's offer for the mortgage loan business by $50 million.
Lone Star said it would be willing to be the stalking horse for the assets now due to go to Ally and would want a breakup fee of $10 million to $20 million.
The case is in re: Residential Capital LLC, U.S. Bankruptcy Court, Southern District of New York, No. 12-12020.