The legendary Mastroianni Brothers Bakery's name will live on, despite the company's shutdown in July and bankruptcy in September.
The Rotterdam company's intellectual property, including the name, was sold Wednesday to a Utica-area family-owned bakery for $220,000.
The sale took place at a competitive auction held Wednesday morning in U.S. Bankruptcy Court in Albany.
Pumilia's Pizza Shells, which also does business as New York Dough Co., outbid Koffee Kup Bakery of Burlington, Vermont, in an auction before Bankruptcy Court Judge Robert E. Littlefield Jr.
The auction saw the price rise rapidly from an initial bid of $50,000, based on a pre-auction offer from Koffee Kup.
A second auction, an online auction for the company’s baking and office equipment, is scheduled to conclude Thursday morning.
The bakery opened in Rotterdam in 1923, with its products offered in restaurants and sold in supermarkets like Price Chopper and Hannaford. The quality of its bread was widely praised, but declining sales following the death of president Armond Mastroianni in 2008 lead to business failure.
Warren Zeiser, the most recent CEO of Mastroianni Brothers, worked with Pumilia's leading up the bid, and said the successful bid means the company will live on in upstate New York, though it is unclear whether Mastroianni will continue as a separate operation.
"The goal is to restart the bakery," Zeiser said after the auction. He said an announcement should be made within the next few weeks.
Pumilia's Pizza Shells was founded in 1993 by Lorenzo Pumilia. He came to the United States from Italy in 1975 and opened a pizzeria in the Utica area. Based on demand, the pizza shell company was formed to sell pizza dough in supermarkets.
The company remains family-owned. Lorenzo's grandson John Pumilia was among those representing the company in the courtroom. He said the company is looking to expand from its bakery location in Waterville, just outside Utica.
"The good thing is the company will stay in upstate, the jobs will stay in upstate, and the taxes will stay in upstate," Zeiser said.
Zeiser took over as CEO of the bakery in 2015, brought in by the Mastroianni family in an effort to turn the company around. The company introduced new bread products like whole-grain breads designed to appeal to new customers, but Zeiser said it turned out to be too late to reverse the decline of the company, which had 50 employees.
In its Chapter 11 bankruptcy filing, the company listed just over $800,000 in debt owed to about 55 unsecured creditors. Wednesday's auction proceeds will go toward settling the debts, as will a minimum of $425,000 expected to be received from the equipment auction. Pumilia said it isn't bidding on the equipment, which must be removed from the company's site at 51 Opus Blvd. by Dec. 31.
Bidding for the name and intellectual property began at $60,000, with minimum incremental increases of $2,500.
Meghan Breen, an attorney representing Koffee Kup, kept rapidly trading bids with Zeiser. She took two breaks to consult by phone with her client before finally saying Koffee Kup wasn't willing to match the $220,000 figure.
Breen indicated in court that until Tuesday, Koffee Kup had believed it was going to be the only bidder, which would have let it get the intellectual assets for $50,000. As part of the arrangement, Koffee Kup will have a $5,000 deposit returned.
Koffee Kup Bakery, which is also family-owned, is best-known for its packaged doughnuts, but also sells a variety of hamburger, hot dog and sandwich rolls.
Reach Gazette reporter Stephen Williams at 395-3086, email@example.com or @gazettesteve on Twitter.