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Relativity Media’s unsecured creditors committee objects to proposed bid process, sale of assets
By Mark Reccek
Bethlehem, Pa., Aug. 13 – Relativity Media LLC’s official committee of unsecured creditors objected to the proposed bid procedures for the sale of assets and the stalking horse asset purchase agreement, according to an objection filed Wednesday with the U.S. Bankruptcy Court for the Southern District of New York.
The auction date is scheduled for Sept. 16, and the sale hearing date is scheduled for Sept. 21. The deadline to submit bids is Sept. 11.
The company entered into a stalking horse asset purchase agreement with RM Bidder LLC.
According to the objection, the proposed bid procedures would establish an unreasonably aggressive timeline for the sale process that is insufficient to ensure that the value of the company’s assets is maximized.
“A longer time frame would enable the debtors’ and the committee’s advisors to canvas alternative potential acquirers, as well as to investigate alternative sale structures and financing arrangements that could increase value for the estates over the currently contemplated proposal,” the objection said.
The committee also said the proposed break-up fee and expense reimbursement are unwarranted and inappropriate. More specifically, the committee argues the proposed bid procedures are deficient as they unjustifiably favor the RM over other prospective bidders and permit RM to credit bid before the committee has an opportunity to investigate and confirm the nature and extent of the claims and liens.
As previously reported, RM will acquire substantially all of the assets of Relativity, subject to court approval and an auction process.
The company said the auction process is expected to conclude with a sale closing on Oct. 2.
Relativity Media LLC is a global media company based in Beverly Hills, Calif., that filed for bankruptcy on July 30. The Chapter 11 case number is 15-11989.
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