Gawker Seeks Chapter 11 Bankruptcy Protection; Online Company To Be Put Up For Auction

By Erik Pedersen, David Lieberman

Hulk Hogan has claimed another victim. Or was it Peter Thiel? Either way, or both, Gawker Media today filed for Chapter 11 bankruptcy protection in the wake of a $140M verdict in the ex-pro wrestler’s invasion-of-privacy lawsuit against the company behind such popular blogs as Deadspin and Jezebel (read the document here).

The Wall Street Journal reports that Gawker Media Group will be put up for auction, starting with a $100M bid by publisher Ziff Davis. Properties in the sale would include Gawker as well as Gizmodo, Lifehacker, Kotaku, Jalopnik, Deadspin, and Jezebel.

“In the event we become the acquirer, the additions of Gizmodo, Lifehacker and Kotaku would fortify our position in consumer tech and gaming,” Ziff Davis CEO Vivek Shah told staffers in a memo obtained by Re/code. “With the addition of Jalopnik, Deadspin and Jezebel, we would broaden our position as a lifestyle publisher. Much like us, GMG is heavily active in driving commerce-based revenues and has an impressive publishing and commerce platform with Kinja.”

A Florida circuit judge late last month upheld the nine-figure award to Hogan, whose legal effort was backed by Silicon Valley billionaire Thiel. Gawker had published a sex tape featuring Hogan.

Gawker made its filing today at the U.S. Bankruptcy Court in New York. It says that the company hired Opportune’s William Holden to serve as Chief Restructuring Officer, with Houlihan Lokey Capital providing investment banking services.

Hogan — under his real name, Terry Gene Bollea — leads the list of creditors with a disputed unsecured claim of $130 million.

Gawker says it has somewhere between 200 and 1,000 creditors. It estimates its assets at between $50 million and $100 million, with liabilities of more than $100 million. It has a credit agreement that enables it to draw up to $22 million in debtor-in-possession financing.

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