Gawker Media has been sold — and with the sale comes questions of what happens next.
Late Tuesday, Univision purchased the media company for $135 million following a bidding war with Ziff Davis. With the $140 million verdict from the Hulk Hogan trial hanging over the company, and Gawker’s complicated tax strategy to untangle, the question remains: who gets all this money?
Fortune’s John Jeff Roberts did an investigation into Gawker’s finances, and broke down what will happen once the sale is finalised.
For now, the money from the sale will go into a fund which is overseen by the bankruptcy court. Gakwer founder Nick Denton has said Gawker plans to appeal the Hogan verdict, so the money will be used for legal costs or eventual damages if Gawker loses. If there’s any money left after the legal process, that will go to Denton and Gawker’s other investors.
But there are several other factors at play, Fortune reports:
- Secured creditors like Silicon Valley Bank will also be paid about $22 million of the $135 million
- According to a media lawyer interviewed by Fortune, it’s unlikely the Hulk Hogan verdict will be overturned, but the court may reduce the amount awarded to Hogan
- As part of its Chapter 11 filing, Gawker will likely have to pay some of its shareholders, which will happen after the sale is finalised in August
- Gawker also doesn’t have much money left in the bank (unrelated to the proceeds from the sale), as it essentially emptied its coffers three years ago when it paid out dividends from its Hungarian subsidiary
What this means is that Gawker’s battles are far from over, despite the $135 million sale. For a deep dive on Gawker’s finances — and a look into exactly how the company avoids paying U.S. corporate taxes — read Roberts full piece on Fortune.