Relativity Lender Pushes to Postpone Bankruptcy Hearing

A major Relativity Media creditor is asking for the court to postpone a hearing on a loan the company needs to continue operating through bankruptcy.

In court filings, Manchester Securities, a subsidiary of the New York-based hedge fund Elliott Associates, accuses Relativity of having “violated basic notions of due process, fundamental fairness” by not sharing information about the film and television company’s valuation and a deposition from its founder Ryan Kavanaugh. It would like the court to push a hearing on whether Relativity can receive $45 million in debtor-in-possession financing from Tuesday until Friday.

Manchester is one of Relativity’s biggest lenders. It is owed $137 million, according to the company’s initial bankruptcy filing. Relativity has liabilities of almost $1.2 billion and assets with a book value of just under $560 million. The company has produced such films as “The Immortals” and “Act of Valor,” and backs television programs like “Catfish: The TV Show” and “The Great Food Truck Race.”

The discussion on bid procedures and interim financing was originally slated to take place on Aug. 14, but was pushed back after the court approved $2.5 million in additional financing to keep Relativity operational. That cash injection was in addition to $9.5 million in financing that the judge approved on July 31, a day after Relativity filed for bankruptcy protection.

Tuesday’s hearing in bankruptcy court in New York City will allow U.S. Bankruptcy Court Judge Michael Wiles to consider a plan that would call for Relativity to be auctioned off on Oct. 1. A stalking horse bidder comprised of Relativity senior lenders such as Luxor Capital Group, Falcon Investment Advisors, Colbeck Capital and Anchorage Capital has agreed to pay $250 million for Relativity. A total of 14 potential bidders have reviewed financial details about the company.

A spokesman for Relativity did not immediately respond to a request for comment.

Related stories

Ryan Kavanaugh Left Adrift in Hollywood as Relativity Implodes

Japanese Distributor Epcott Files For Bancruptcy

Japanese Indie Distributor France Eigasha Goes Bankrupt

Get more from Variety and Variety411: Follow us on Twitter, Facebook, Newsletter