Real Alloy Holding Inc. noteholders are making a play to buy the distressed company as a "stalking horse" bidder, choosing a credit bid that’s substantially higher than the multiple cash bids the company has received.

This move was made in advance of a previously announced court-approved bid deadline of January 31.

The bidders are gunning for the North American and European business units, but the bid has to survive potentially higher and better bids made before a March 19 deadline.

In November 2017, Real Alloy voluntarily entered Chapter 11 reorganization for its U.S. operations. Severely tightened liquidity had constrained trade credit terms, preventing the company from refinancing its $305 million, 10 percent senior secured notes due January 2019, or expanding its borrowing capacity.

The company struck an agreement to use its $110 million asset-based lending facility and up to $85 million of additional liquidity as a debtor-in-possession to get the breathing room needed to serve its customers and pay its suppliers. The DIP financing also includes the conversion of $170 million of senior secured notes into new notes that will help cover normal operating and working capital requirements.

Not included in the Chapter 11 filings are Real Alloy’s operations in Germany, the UK, Norway, Canada, Mexico and a joint venture in Arizona. They’re all self-supported and Real Alloy said it will not pull money away from any of them to fund its U.S. operations. Real Alloy received approval from the U.S. Bankruptcy Court for the District of Delaware to proceed with Chapter 11 reorganization on November 20.

“We are pleased to have the continued support of our noteholders and to have received numerous bids during the stalking horse phase of the sales process,” Terry Hogan, president of Real Alloy, said in a recent statement. “We look forward to working through the milestones in our financial restructuring and completing an orderly sale of the business to maximize value as planned. By the beginning of May, we expect to have new ownership in place that supports our business, customers, suppliers and employees.”