The town will have to wait another two months to see whether the U.S. Bankruptcy Court will approve a motion to switch Relativity Media’s Chapter 11 status to a Chapter 7 liquidation. This comes after an investor in the company officially motioned the court this month and less than a year from when Relativity emerged from bankruptcy saying it would be financially stable. As we reported late last year, the company was expected to file for Chapter 7, which means liquidation. The hearing on the status change was just moved from March 8 to May 17.
Court records showed operating losses in excess of $50 million and that there has been no capital raised to keep the company, run by Ryan Kavanaugh, on its feet. It also owes $14M-plus and a required $30M payment from June 30 of last year to RM Bidder (senior lender Anchorage Capital). That was also left unpaid. Joe Nicholas, who had invested millions into Relativity, exited his post as co-CEO last year. Restructuring company Zolfo Cooper is still understood to be on board.
Deadline has learned that Relativity’s offices are still open, and that a skeleton staff remains. Kavanaugh did not respond to calls from Deadline.
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