WOODLAND HILLS, Calif. — A federal judge today approved the sale of substantially all of Penthouse Global Media’s assets free and clear of all liens and claims to XVideos parent company, WGCZ Ltd., which was the successful bidder for the bankrupt company’s properties.
With the green light from U.S. Bankruptcy Judge Martin Barash this morning, the $11.2 million sale to WGCZ is expected to close tomorrow.
WGCZ placed the winning bid for all of Penthouse’s assets several weeks ago — intellectual property, videos, publications, broadcasting and digital rights.
Barash ordered that once the sale closes, the trustee will pay Dream Media Corp. all of the proceeds less carve-out fees to be retained by the trustee.
Dream Media, helmed by media investor Adam Levin, held notes for $10.3 million in Penthouse debt, which led the company down a pathway towards insolvency.
Dream Media was one of several bidders for Penthouse at auction. Other bidders included Hustler and MindGeek.
WGCZ , prior to closing, must resolve a number of contracts it has with companies such as broadcast distributor Claxson Media LLC and sex toy company Topco Sales, among others, the judge wrote.
Barash noted that the timely sale of Penthouse’s assets was imperative to preserve the value of the estate. Accordingly, he said that there was cause to lift several stays contemplated over the sale or lease of property and the assumption of contracts.
Firming up the deal, Barash wrote in his order, “Upon closing, the successful bidder shall acquire all rights in and to the assets, free and clear of all liens, claims, encumbrances, and interests, including without limitation the right to use, publish, and otherwise commercially exploit all audiovisual works and works of visual art included in the assets, which works are listed in the schedules of the successful bidder.”
WGCZ operates numerous well-known adult brands besides XVideos.com. It owns BangBros, LegalPorno.com and DDFNetwork.com, as well as XNXX.com, XXX.com, Porno.com, Swingers.com, FreePorn.com, SuckMeOff.com, Chicks.com, Vidz.com, Mess.com, Nipples.com and BigOnes.com. It also operates cam sites Camster.com and CamDolls.com and provides advertising capabilities via TrafficFactory.biz.
Penthouse Global Media, founded in 1965, publishes Penthouse Magazine and Penthouse Letters and operates eight TV channels in more than 100 countries, which account for 50 percent of its revenue.
