Relativity asset sale procedures approved; auction to be held Oct. 1

By Caroline Salls

Pittsburgh, Aug. 28 – Relativity Media, LLC obtained court approval of the bid procedures for the proposed $250 million sale of the company, according to an order filed Friday with the U.S. Bankruptcy Court for the Southern District of New York.

As previously reported, Relativity entered into an agreement with RM Bidder LLC, an entity formed and owned by some of the company’s pre-bankruptcy lenders, under which RM Bidder will serve as the stalking horse bidder for substantially all of the assets of Relativity.

According to the asset sale motion, the purchase price will include the discharge in full of all amounts outstanding and obligations under the company’s debtor-in-possession loans, the discharge in full of all amounts outstanding and obligations under term A loans, the discharge of a portion of the principal amount of debt and interest accrued on the closing date plus any penalty or pre-payment fees owed under term B loans and the assumption of liabilities.

The sale and auction process will be conducted by Blackstone Group LP and FTI Consulting LLC.

If RM Bidder is not the high bidder for the assets, it will receive a $3.75 million break-up fee and reimbursement of up to $1 million of its sale-related expenses.

Competing bids are due by noon ET on Sept. 25.

An auction will be held on Oct. 1, if necessary. The sale hearing is scheduled for Oct. 5.

Relativity Media, a film studio based in Beverly Hills, Calif., filed bankruptcy on July 30. The Chapter 11 case number is 15-11989.

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