Local cable channel operator Plum TV has filed Chapter 11 bankruptcy. But the company may not be in Chapter 11 reorganization for long, since it has already lined up a new buyer.
PMG Media Group has already signed an agreement to lend Plum TV $1 million to fund its operations as a debtor-in-possession and then buy the company for that $1 million, plus assumption of $14 in senior debt. PMG has also cut a deal with the debt holders to exchange their senior note for a 30% equity stake in the new company.
The senior debt is currently held by Thomas Scott, Chairman of Plum TV, and Jeffrey Stewart, Secretary and a Director.
PMG Media brings some big names to the deal. Its investor group is led by former Univision and Hearst Television executive Terry Mackin, now President of ForesightLab, a media consultancy, and Bill Apfelbaum, Chairman of Media Ventures Group. He previously headed outdoor advertising company Titan worldwide.
Of course, there will be a formal bankruptcy court auction, with PMG as the “stalking horse” bid. Any other bidder who wants to buy Plum TV will have to top the $15 million bid by at least $100K and PMG will get a break-up fee if it is outbid.
Plum TV operates cable channels in eight targeted luxury markets: Aspen, Vail, and Telluride, CO; “The Hamptons” in Long Island, NY; Martha’s Vineyard and Nantucket, MA; Miami Beach, FL; and Sun Valley, ID. The company says it also publishes print magazines, operates an interactive website, and broadcasts “through other electronic media outlets.”
“We want to reassure our audiences and advertisers that Plum TV remains in business and will continue to provide our daily programming throughout this process,” said Tom Scott, Plum TV founder and Chairman.
“While a filing is a difficult choice, after a tough time for the company, it is the right choice,” he added. “As longtime, visionary senior media executives, Terry and Bill have excellent track records and we believe the Plum TV brand will be well positioned when it emerges from the proposed asset sale.”