Digital Domain Media Reaches DIP Financing Agreement With Lenders
Digital Domain Media Group, Inc. (DDMG) announced that it has reached agreement with its senior noteholders to provide approximately $11.8 million of debtor-in-possession (DIP) financing as requested by motion submitted to the U.S. Bankruptcy Court for the District of Delaware and for the use of the senior noteholders’ cash collateral.
In addition, the company announced that Searchlight Capital Partners, who as previously announced has entered into a purchase agreement, with an initial bid of about $15 million, with DDMG to acquire Digital Domain Productions and its operating subsidiaries in the United States and Canada (DDPI), including Mothership Media, has reasserted its aspiration to acquire the visual effects business of DDPI and Mothership. Searchlight’s agreement to acquire Digital Domain’s visual effects business is subject to higher and better offers and Court approval. The public auction date is currently set for September 21, 2012 in New York.
“Our agreement demonstrates our support and belief in the visual effects business of Digital Domain, led by Ed Ulbrich and his team. The outcome yesterday in court provides for a timely and orderly auction process and assures that the company will be amply funded until the transaction closes. This will allow Digital Domain to continue serving all of its customers on all existing projects with no interruptions or delays. We have made a significant commitment to capitalize the business, which will allow Digital Domain to thrive as a leading visual effects company,” said Eric Zinterhofer, co-founder, Searchlight Capital Partners.
DDMG filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware on September 11, 2011 and will seek ancillary relief in Canada, pursuant to the Companies’ Creditors Arrangement Act (CCAA) in the Supreme Court of British Columbia, Vancouver Registry.
Searchlight Capital Partners, L.P. is a private investment firm founded in 2010 by senior partners formerly with industry leading investment management firms.