Cerberus to Provide Gawker With $22 Million Bankruptcy Loan
2016年6月14日 - 7:00AM
Dow Jones News
Cerberus Capital Management L.P. has agreed to throw a $22
million lifeline to Gawker Media Group so the digital media company
can stay alive in bankruptcy pending a sale of its business.
Gawker, which filed for bankruptcy protection Friday, said
Cerberus Business Finance, the private-equity firm's lending arm,
has agreed to provide it with $14 million on an interim basis plus
another $8 million following final bankruptcy court approval.
Absent the cash, Gawker restructuring chief William Holden said
Monday, the company would be unable to pay its employees or vendors
and be forced to liquidate.
The bulk of the Cerberus loan, $12.3 million, will pay off
Gawker's lender Silicon Valley Bank, according to the filing in
U.S. Bankruptcy Court in New York.
Cerberus, named after the mythical three-headed dog that guards
the gates of Hades, was founded by former Drexel Burnham Lambert
trader Stephen Feinberg in 1992. The $30 billion firm, whose
leadership includes former U.S. Vice President Dan Quayle and
former U.S. Treasury Secretary John Snow, is a big player in the
trading of distressed-debt, where investors buy corporate loans
trading at a deep a discount with an eye toward profiting from
restructuring a company's balance sheet.
Gawker filed for bankruptcy and put itself up for sale Friday
after a Florida judge upheld a $140 million jury judgment against
it in a costly legal battle with former professional wrestler Hulk
Hogan. Gawker is appealing the ruling.
The filing marked a stunning reversal for the 14-year-old
business whose aggressive, irreverent style of reporting engendered
media fascination as well as ire among the enemies. Last month,
Silicon Valley billionaire and investor Peter Thiel acknowledged
financing the legal fight of Terry Bollea, whose pro wrestling name
is Hulk Hogan, and other such battles involving people who Mr.
Thiel feels have been targeted unfairly by Gawker. Mr. Thiel was
outed as gay in 2007 by Gawker's now-defunct Valleywag blog.
The company plans to sell its assets in bankruptcy court and has
received an opening bid of $90 million from the digital-media
company and magazine publisher Ziff Davis LLC. That offer is
subject to higher bids at a bankruptcy auction.
Proceeds from a sale will be funneled to a trust to finance
further litigation or cover whatever damages may ultimately be
leveled following appeals, which could take years to resolve.
Gawker has said that it expects to ultimately prevail.
Whatever money is left at the end of the legal process will go
to Gawker Founder and Chief Executive Nick Denton, who owns most of
the company, and other shareholders. Earlier this year, Columbus
Nova Technology Partners -- the U.S. investment arm of the Renova
Group, a conglomerate owned by Russian billionaire Viktor
Vekselberg— took an undisclosed minority stake in the media company
as it shored up its books for the trial. Gawker owes the company
$15 million, according to court filings.
Lukas Alpert contributed to this article.
Write to Patrick Fitzgerald at patrick.fitzgerald@wsj.com
(END) Dow Jones Newswires
June 13, 2016 17:45 ET (21:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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