We haven’t been giving daily updates on the AMS bankruptcy story because it’s been too exhausting! With all the daily drama and legal wrangling — it’s almost like a soap opera. Our pal Jim Milliot at Publishers Weekly, however, has been following every twist and turn. Just to bring everyone up to speed, you’ll recall that giant distributor AMS recently declared bankruptcy, leaving publishing giants like Random House with millions owed, and a few comics publishers, like Dark Horse, in the mix as well. All were distributed by Publishers Group West, the profitable arm of the sometimes questionable AMS empire.
When last we left you, Perseus had made an offer to purchase the PGW accounts, but as of yesterday, National Book Network had jumped into the fray by making a BETTER offer:
National Book Network has proposed taking over the distribution contracts of PGW clients, offering to pay 85 cents for every dollar owed publishers in the AMS bankruptcy and asking for a three-year contract extension. The proposal, which was made last night, compares to the 70 cents/four year extension offer made by Perseus Books Group. To help win the backing of the creditors’ committee and approval from the bankruptcy judge, NBN has filed an unsecured claim to retrieve the balance of the funds—rather than an administrative claim, as Perseus has—a move that could leave more money for all creditors to be paid.
Today, Milliot reports, it looks like publisher are all over the NBN bid:
Many PGW publishers, to no one’s surprise, welcomed the news that a second company had stepped forward offering to buy the distributor. The consensus among publishers is that there is no reason not to sign the NBN offer, and that the bankruptcy court will decide what the best proposal is. As one now cynical publisher observed, “All the judge cares about, one must assume, is maximizing the size of the estate.”
Prompted in part by the NBN offer, several parties have filed motions with the court asking for a delay in ruling on the Perseus bid, which is now set for February 12. In a motion filed yesterday, the unsecured creditors committee objected to a request by AMS that the court approve the sale to Perseus without the need for an auction or other procedures “to test the adequacy of the proposed transaction.” Moving forward on the proposed time line, the objection states, “does not allow for adequate time for the post-petition solicitation of purchasers and for competitive bidding.”