A group of senior lenders attempting to buy Relativity Media at auction has responded to the objections of dozens of unsecured creditors attempting to delay the sale process, according to new filings in New York Bankruptcy Court Friday.
The group — comprised of Anchorage Capital, Falcon Investments and Luxor Capital — moved to placate some subordinate debt holders by assuring swift repayment in a potential sale, as many creditors fear they’ll never recoup losses from the bankrupt studio.
The senior lenders, who have a $250 million stalking-horse bid for Relativity’s assets under the name RM Bidder LLC, specifically address concerns from firms like Manchester Securities and refuted claims of self-interest in their pursuit of an expedited sale.
Manchester and other creditors worry that a quick sale would discourage competitors from doing due diligence and bidding up the price, leaving many more creditors underpaid or empty-handed.
The stalking-horse group also defended its plans to maintain upfront payment of creative unions like the Screen Actors and Directors Guilds — who count past-due funds and future residuals in Relativity’s film and TV projects. It also agreed to waive a 1.5 percent reimbursement on their legal expenses should the sale fall apart.
RM Bidder responded to the aggressive legal maneuvering of P&A lender RKA Film Financing, which filed a motion this month attempting to seize four movies that it loaned the studio money to promote.
In Friday’s filing, the lenders said they would pay in “full cash” monies owed to companies tied to the studio’s yet-to-be-released films — all of which have been pulled from the release schedule.
On Tuesday, Relativity and its many lenders and creditors will return to the New York courtroom of U.S. Bankruptcy Court Judge Michael Wiles for a second bankruptcy hearing where many of the competing claims are expected to be resolved.