Relativity Creditors Accept Reorganization Plan
The group of creditors involved in the Relativity Media bankruptcy case said Monday that it supports the studio's plan of reorganization.
Relativity Media moved one step closer to emerging from bankruptcy in the coming weeks.
The official committee of unsecured creditors involved in the studio's bankruptcy case said Monday that it supports Relativity's plan of reorganization and recommends that all unsecured creditors vote to accept the plan.
“We have been working tirelessly with all parties to develop a plan of reorganization that allows Relativity to emerge from Chapter 11 as a well-capitalized, strong company," said Relativity chairman and CEO Ryan Kavanaugh. “We are pleased to receive this support from the creditors’ committee, which further clears the path for the company to emerge in early 2016 with a robust slate of films and the flexibility to execute our strategy as a fully integrated 360 degree content engine.”
The presiding judge will still need to approve it, and a court hearing to consider confirmation of the plan is scheduled for Feb. 1.
“We are excited to move forward with normal day-to-day operations on Feb. 1 and are incredibly grateful to the creditors’ committee for their support,” added Kavanaugh.
Relativity filed for Chapter 11 in July, launching one of the most closely watched bankruptcies in Hollywood history. The committee of unsecured creditors was formed Aug. 7 and began evaluating a $250 million stalking horse bid, a possible Relativity sale and DIP financing terms.
After months of often contentious negotiations, Kavanaugh reached an agreement with the committee, the stalking horse bidders and other interested parties for Relativity to sell only its television assets to the stalking horse group for $125 million. In return, he would pursue a Chapter 11 plan of reorganization around his remaining film, sports and music businesses and related assets with new debt and equity capital in tow.
Relativity Studios is moving forward with a slate of films this year that includes The Disappointments Room, Before I Wake, Kidnap, Masterminds and Strangers 2. In addition, the studio is scheduled to begin production on a reboot of The Crow in March.