Relativity Media, the beleaguered movie and television studio that’s been running on fumes, has entered into an agreement to sell the bulk of its remaining assets to UltraV Holdings LLC. The studio’s new owner is described in a release as a joint venture among funds managed by Sound Point Capital Management and RMRM Holdings.
UltraV says it will inject capital into the company so it can begin producing and developing content. It also made a point of stressing that it believes Relativity’s distribution agreement with Netflix is still in effect. Netflix has previously tried to get out of that pact as Relativity’s financial woes have exacerbated.
Weighed down by film flops such as “Out of the Furnace” and “Earth to Echo,” Relativity filed for bankruptcy protection in 2015. At the time it had a book value of $560 million, and liabilities of nearly $1.2 billion. After exiting Chapter 11 in 2016, the studio struggled to gain its footing (at one point it was nearly run by Kevin Spacey), and was never able to raise enough money to keep operations going. In September of 2016, it released two films, “The Disappointments Room” and “Masterminds,” but both flopped.
The sale to UltraV needs court approval, but the prospective new owners expect it to close in the next 45 to 60 days. Ryan Kavanaugh, the founder of Relativity Media, was not mentioned as being part of the transaction. However a press release included a quote from the one-time mogul.
“I still very much believe in the Relativity Media business model,” Kavanaugh said in a statement. “Unfortunately, the company faced the significant challenge of a complicated capital structure and an evolving industry. I could not be more pleased about this agreement with UltraV. The transaction will result in a fresh start for the company, and it turns Relativity over to owners who have a sincere appreciation for the business, the art and the long term needs of the industry.”
Deadline first reported the sale agreement.