Engineering and construction group McDermott will move forward with its previously announced sale of subsidiary Lummus Technology to a partnership of The Chatterjee Group and Rhone Capital, having failed to attract higher bids at auction.

In January, McDermott entered into a share and asset purchase agreement to sell the business to the partnership as the “stalking horse bidder” for a base price of $2.725 billion, subject to receiving higher or better bids through a court-supervised auction.

The US company confirmed it did not receive a higher or better bid during the solicitation period and the auction previously scheduled for Mar. 9 will not take place.

McDermott added that it will have the option to retain or purchase a 10% common equity ownership interest in the entity that buys Lummus Technology.

The sale is part of McDermott’s Chapter 11 bankruptcy process, which will see it implement a major restructuring that is expected to wipe out more than $4.6 billion of debt. Proceeds are expected to repay McDermott’s debtor-in-possession (DIP) financing in full as well as fund emergence costs and provide cash to the balance sheet for long-term liquidity.

A hearing to confirm the sale will take place on Mar. 12.