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article imageWhat will happen to the $135 million from the sale of Gawker?

By Business Insider     Aug 17, 2016 in Internet
Gawker Media has been sold — and with the sale comes questions of what happens next.
Late Tuesday, Univision purchased the media company for $135 million following a bidding war with Ziff Davis.
With the $140 million verdict from the Hulk Hogan trial hanging over the company, and with Gawker's complicated tax strategy to untangle, the question remains: Who gets all this money?
Fortune's John Jeff Roberts did an investigation into Gawker's finances and broke down what will happen once the sale is finalized.
For now, the money from the sale will go into a fund that is overseen by the bankruptcy court. Gakwer founder Nick Denton has said Gawker plans to appeal the Hogan verdict, so the money will be used for legal costs or eventual damages if Gawker loses. Any remaining money will go to Denton and Gawker's other investors.
But several other factors are at play, Fortune reports:
-Secured creditors including Silicon Valley Bank will be paid about $22 million.
-According to a media lawyer interviewed by Fortune, the Hulk Hogan verdict is unlikely to be overturned, but the court may reduce the amount awarded to Hogan.
-As part of its Chapter 11 filing, Gawker will most likely have to pay some of its shareholders, which will happen after the sale is finalized.
-Gawker also doesn't have much money left in the bank (unrelated to the proceeds from the sale), as it essentially emptied its coffers three years ago when it paid out dividends from its Hungarian subsidiary's profits.
This means Gawker's battles are far from over, despite the $135 million sale. For a deep dive on Gawker's finances — and a look into exactly how the company avoids paying US corporate taxes — read Roberts' full piece at Fortune.
This article was originally published on Business Insider. Copyright 2016.
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