Posted in: Comics, Current News | Tagged: Ad Populum, bankruptcy, diamond
Diamond Comics Gets Fourth DIP Financing Extension To Pay Publishers
Diamond Comic Distributors gets a fourth DIP financing extension approved to pay off publishers, some of them
Article Summary
- Diamond Comics secures a fourth DIP loan extension to help pay off overdue debts to publishers and creditors.
- The new agreement boosts funding to $9 million and extends the repayment deadline to June 28, 2025.
- Court requires Diamond to provide updated financial projections and budgets as part of ongoing bankruptcy.
- Ad Populum, Diamond's new owner, is restructuring operations and renegotiating key leases amid layoffs.
The United States Bankruptcy Court has approved the latest amendment to the Debtor-in-Possession (DIP) Credit Agreement between Diamond Comic Distributors, its debtors, and JPMorgan Chase Bank. This means that Diamond Comic Distributors can keep going under Chapter 11 bankruptcy protection, even though it was just bought by Ad Populum in a bankruptcy auction. And maybe some of the publishers who haven't been paid recent bills might actually get paid. Here's hoping. According to a statement Diamond issued on this matter, the Bankruptcy Estate is responsible for invoicing related to all sales up to May 15, while new ownership is responsible for invoicing from May 16 and beyond. We've reported how this has recently impacted the specific case of Dynamite, and it is certainly having an effect on other publishers as well. Further, in its application to the court for this new amendment to the DIP agreement, Diamond still has obligations under the transition service agreements with Universal and Sparkle Pop.
The fourth amendment, approved two days ago, increases the amount of money available to almost nine million dollars. The date that this has to be paid off is now the 28th of June 2025, rather than yesterday, unless they pay it back early. These amendments are intended to provide Diamond with financial flexibility for the final stages of their bankruptcy proceedings. The court did, however, state that they have to send an updated 13-week budget and cash flow projections to both the DIP Lender and the Committee by June 13th or a later agreed-upon date. We know how good they have been with getting paperwork in on time.
In other news, Diamond is seeking to reject their ongoing lease of their headquarters and warehouse in Hunt Valley, Maryland, as part of its Chapter 11 bankruptcy dealings, effective yesterday. The original lease was entered into in 2012, between Diamond and the landlord, SFV York Road, and now, the new Diamond owners, Ad Populum, have negotiated their own deal with the landlord. And as a result, they planned to surrender the premises and keys yesterday to… themselves? Yes, it's weird. Welcome to bankruptcy proceedings.
You can use these Diamond, Ad Populum, Penguin Random House and bankruptcy tags to keep up with the latest on Bleeding Cool. Here's a timeline if you want to catch up…
- On the announcement of Chapter 11 on the 14th of January, Diamond started a 13-week bankruptcy process run by financial firm Raymond James, got financing to operate, and announced an auction for its assets.
- Those assets included Diamond Comic Distribution, Alliance Gaming Distribution, Diamond Select Toys, CGA and Diamond UK
- Universal Distribution was named the Stalking Horse bidder for Alliance Games and Diamond UK, which required a purchase commitment of thirty-nine million dollars, but with certain discounts and privileges for taking that position.
- The auction took place, and it went late. There was food and breakfast billed for.
- And Alliance Entertainment, or AENT, was named the top bidder for the assets of $72,245,000, though not for Diamond UK. This was widely announced, including by Diamond themselves.
- Then we learned that a joint bid by Universal Distribution and Ad Populum came second and was named the back-up bid, with a bid of $69,130,000. With Universal getting Alliance and Diamond UK, and Ad Populum getting Diamond Comics, Diamond Select Toys and everything else. Basic Fun was third with fifty million.
- A court hearing with the Honorable Judge Rice in Courtroom 9-D at the United States Bankruptcy Court for the District of Maryland at 10 am was intended to ensure the legality of the bid and the process.
- But instead, over that weekend, the debtors declared that they had chosen the back-up bid from Universal and Ad Populum instead of AENT, despite AENT having bid more. No reason was given.
- AENT filed a lawsuit regarding this decision.
- It took the bankruptcy court to reverse that decision and state that AENT, with the higher bid, had won, though they would have to withdraw their lawsuit.
- AENT has terminated their winning bid and purchase.
- Universal Distribution and Ad Populum were back in the running
- Diamond declared "business as usual" but the courts threatened Chapter 7 over late paperwork.
- AENT sued Diamond, claiming fraud
- Diamond says it's all in hand and went back to court, wanting to be owned by Universal and Ad Populum.
- Sale of Diamond to Universal and Ad Populum was approved by the courts.
- Though Ad Populum paid more than we thought.
- Podcast blamed/credited with the current state of affairs
- Diamond tells Skyrush to stop claiming they won CGA.
- As part of court filings, Diamond released details for every comic store on account.
- We have some finality.
- Ad Populum and Universal Distribution officially acquire Diamond and related assets.
- The layoffs have begun.
- And continue.
- Diamond Select Toys has closed
- Diamond try and reassure retailers over ComicSuite
- Courts withdraw Chapter 7 bankruptcy threat
- We look at the future of Diamond Previews again
- PRH pulls out of Diamond entirely
- Well, not entirely, the UK can stay.
- Hermes Press says Diamond doesn't want to distribute their comics anymore… or anyone's.
- But Diamond pushes back on that, as they publish a new Previews.
- And they assure comic book stores that everything is going to be fine. Honest.
- Then send a letter to publishers which looks like it isn't
- Now they are looking for more money and longer to pay it back.
- Dynamite would like half a million now, please.
- Udon and Manga Classic have now cancelled all Diamond orders.
- Then so did Drem Productions
- And PRH starts to close their special retailer joining offer
