March 29, 2019
New York-based Sizmek Inc., an online advertising campaign management and distribution platform for advertisers, media agencies, and publishers, filed for bankruptcy in the Southern District of New York. The company indicates that it lost access to capital when Cerberus Business Finance LLC “…took control of the Company's bank accounts and sought to divert customer receivables…” and filed, in large part, to have access to its lenders’ cash collateral. Major creditors include players in the ad world, including Google Inc. ($GOOGL), Facebook Inc. ($FB) and AOL ($VZ)(yes, AOL is still, technically, a “player” in something).
The company is a portfolio company of private equity firm, Vector Capital, which took the company private — merely two years after its IPO — via a 2016 all-cash tender offer for the outstanding shares of common stock for $3.90/share, a 65% premium over the then-30-day weighted average trading price. Kirkland & Ellis LLP represented Vector in the transaction.* In 2017, the company made a $145mm acquisition of Rocket Fuel, another struggling adtech company. And then shortly thereafter, AdExchanger reported merely two years later that Vector was looking to divest the company.
We’ll have more on this once the docket is updated.
*Interestingly, after filing, Katten Muchin Rosenman LLP replaced Kirkland & Ellis LLP as debtors’ counsel in these cases.
Jurisdiction: S.D. of New York (Judge )
Capital Structure: $172mm funded debt
Legal: Kirkland & Ellis LLP (James Sprayragen, Stephen Hessler, Marc Kieselstein, Justin Bernbrock)
Replacement Legal: Katten Muchin Rosenman LLP (Steven Reisman, Cindi Giglio, Jerry Hall, Peter Siddiqui)
Board of Directors: Eugene Davis, Mark Grether, Tom Smith, Marc Heimowitz
Financial Advisor: FTI Consulting Inc.
Claims Agent: Stretto (*click on the link above for free docket access)
Other Parties in Interest:
Prepetition Secured Agent: Cerberus Business Finance LLC
Legal: Klee Tuchin Bogdanoff & Stern LLP (David Fidler, Whitman Holt, Michael Tuchin, Thomas Patterson)
Updated 4/1/19 6:08 CT (#10)