Tag Archives: alliance entertainment

Alliance Entertainment Objects to Diamond’s Motion for its Sale to Universal Distribution and Ad Populum

Alliance Entertainment

And the drama around Diamond‘s Chapter 11 continues. This morning we received a new motion by Alliance Entertainment, the original winning bidder, that objects to the sale of Diamond’s assets to the back-up bidders of Universal Distribution and Ad Populum.

For those keeping track, originally, Alliance Entertainment won the bid for Diamond during the bankruptcy process. Diamond then said it wanted to go with the “second best” joint bid by Universal Distribution and Ad Populum, then Alliance threatened to sue, and Alliance won the final approval. Then… in a shocking twist Alliance said it was not going through with the bid. We found out that was because Diamond had withheld key information from Alliance during the process and was suing Diamond and its representatives. After Alliance’s pull of its bid, Diamond released a statement that they had other partners and we speculated it was the back-up bidders. Yesterday, Diamond filed a court motion to go with Universal and Ad Populum as well as to speed up the process with a hearing suggested for today. Part of that hearing also has to do with Diamond’s credit with JPMorgan and dates involving that.

In their motion, Alliance says the motions filed by Diamond are “further collusion” to sell their assets to their preferred buyers rather than maximize their value with the highest bid. They also have issues with the hearing on this twist by Diamond being so soon, especially since it was many days ago Diamond said they had new partners and the deal with Universal and Ad Populum isn’t changed much. Alliance is teasing that Diamond waited to file the motion for the new bid and the hearing to rush the deal through with minimal time for response. Alliance is still figuring out if the back-up sale would or would not provide more value to the Diamond.

You can read the full motion below.

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Alliance Entertainment Submits Complaint Against Diamond Claiming Fraud and Deception

Diamond Comic Distributors

Diamond’s Chapter 11 process has been filled with twists and turns. Originally, Alliance Entertainment won the bid for Diamond in the bankruptcy process. Diamond then said it wanted to go with the “second best” joint bid by Universal Distribution and Ad Populum, then Alliance threatened to sue, then Alliance won the final approval. Then… in a shocking twist Alliance said it was not going through with the bid.

We’ve speculated as to why this was the case and now we know why. Alliance is accusing Diamond of “fraud” and “deception” as far as their relationship with Wizards of the Coast, the company behind Magic: The Gathering. Wizards did not continue its distribution agreement past December 2024 and didn’t inform Alliance. Diamond and its representatives actually attempted to obfuscate it and keep it from Alliance during the deal.

Alliance Entertainment has submitted a complaint to the court.

  1. Defendants fraudulently misrepresented the status of the Debtors’ relationship with Wizards of the West Coast LLC (“WOTC”), the Debtors’ largest vendor accounting for approximately 25% of the Debtors’ Alliance Gaming Business revenue, as part of an intentional scheme to induce Plaintiff to purchase the Debtors’ assets for tens of millions more than the true valuation of those assets. On March 6, 2025 and April 9, 2025, Defendants repeatedly and intentionally represented that Debtors’ relationship with WOTC remained strong and in good standing. Defendants knew this was false. As Plaintiff recently learned, in December 2024, prior to the Petition Date (defined below), WOTC decided that they would not renew the Distribution Agreement (defined below) beyond the December 31, 2024 termination date, thus reducing the Debtors’ Alliance Gaming Business revenue by at least 25%, other than a short 90-day extension as an accommodation to assist the Debtors in their upcoming bankruptcy case and to induce the Debtors to grant WOTC critical vendor status upon the Debtors’ receipt of authority to grant such status to certain vendors. Upon information and belief, the Debtors were aware of WOTC’s decision in December 2024.
  2. Defendants kept this closely guarded secret from Plaintiff, all other bidders in the Auction (defined below), and the Court. For example, Defendants redacted the termination dates from the WOTC agreements that were disclosed to Plaintiff (and, presumably, other bidders). A sliver of truth came to light on April 12, 2025, only after the execution of the AENT APA (defined below) and entry of the Sale Approval Order (defined below), when the Debtors, for the very first time, provided Plaintiff with an unredacted copy of the Distribution Agreement and its amendment, revealing the imminent termination of the WOTC relationship. The Debtors then waited another five days before revealing, for the first time, on April 17, 2025, that WOTC would not renew the Distribution Agreement.
  3. Far from confessing to their deception, on April 17, 2025, Defendants feigned outrage, calling the termination “shocking,” “coming out of nowhere,” and a “slap in the face,” given the Debtors’ twenty-five-year relationship with WOTC. Defendants’ falsehoods were finally laid bare on April 21, 2025, in a video conference involving WOTC, AENT, and the Debtors. WOTC revealed that its decision to terminate the Distribution Agreement was made—and the Debtors were aware of the decision—in December 2024, because the Debtors’ business with WOTC had declined by more than 8% over the last four years, during which period each of WOTC’s other four distributors had significantly increased their sales. Importantly, Debtors did not refute WOTC’s characterization on the video conference.
  4. After this revealing call, AENT tried to salvage the WOTC relationship by proposing to pay WOTC a fixed sum and agreeing to minimum purchase commitments, in exchange for WOTC extending the Distribution Agreement through December 31, 2025. WOTC rejected the proposal.
  5. AENT still sought to move forward with closing the AENT APA transaction, subject to an adjustment in the purchase price to reflect the loss of the WOTC relationship, but the Debtors refused to engage in those discussions. Left with no other option, AENT issued a Notice of Material Adverse Change on April 23, 2025 and terminated the AENT APA on April 24, 2025, as was its right to do pursuant to section 8.1(f) of the AENT APA, based on a Material Adverse Change in Debtors’ operations. A little more than a day later, the Debtors announced that they were moving forward with the sale of Debtors’ assets to another party, the identity of which has not been disclosed.
  6. In addition to defrauding Plaintiff, costing it millions in fees and expenses since its initial bid submission, the Debtors now refuse to return AENT’s earnest money deposit of $8.5 million, providing no reasonable justification for doing so.

In the filing, Alliance has stated this is why they terminated the purchase after Diamond refused to lower its purchase price. There’s five specific complaints within the motion against Diamond and its representatives in the process. Alliance seeks damages of $8.5 million, plus accrued interest and further damages during trial.

You can read the full complaint below but this is a bombshell. With the threat of being moved to Chapter 7, is this the end of Diamond?

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Diamond Comic Distributors Makes a Statement Regarding Alliance Entertainment Pulling Its Bid

Diamond Comic Distributors

In a surprise in what has been a wild ride of a bankruptcy, Alliance Entertainment announced revealed in an SEC filing that was not going through with its bid to acquire Diamond Comic Distributors and more.

While there has been no official court announcement it is expected that Diamond will now going with the second highest bid which was a joint bid between Universal Distribution and Ad Populum. The announcement below mentions “bidders,” which makes it likely this is the case.

After Alliance originally won the bid, Diamond made a surprise announcement of its own that it was going to go with Universal Distribution and Ad Populum‘s bid which caused Alliance to threaten a lawsuit to force their bid being accepted. On April 10, Alliance was eventually officially announced as the winning bid.

Early today, Diamond released the following statement from Diamond Chief Restructuring Officer Robert Gorin but does not mention the “who.”

Diamond Comic Distributors has pivoted to alternative, exceptionally well-known purchasers who are excited to partner with us. These companies have strong balance sheets and, importantly, unmatched presence and experience in our core industries. We are finalizing purchase agreements with these third parties and expect to announce the identities of these purchasers and seek court approval very shortly to complete the sale transactions.

(via Business Wire)

Alliance Entertainment Decides to Not Purchase Diamond

Diamond Comic Distributors

Update: We now know why Alliance has decided to not purchase Diamond after a legal filing claiming fraud by Diamond.

In yet another shocking surprise when it comes to the saga that is the bankruptcy of Diamond Comic Distributors, Alliance Entertainment will not be going through with its purchase of the company after it submitting the winning bid. The company ended its acquisition plans on April 24. The following day, a member of the company’s Board of Directors announced his resignation. It’s unknown if the two events are connected.

No reason was given as to why the decision was made to no longer purchase the company, but the announcement was made in an SEC filing. No court announcement has been made yet. Logic would point fingers at the massive changes in markets recently. Alliance Entertainment has made it clear they really wanted the tabletop game/toy/collectible aspects of the purchase and with recent tariffs, that market has become volatile, unpredictable, and has forced some companies to close already. The reality is, Diamond and its various connected companies aren’t as valuable as they were when the bidding process began.

It is assumed the back-up bidders would now win the process. The back-up winning bid was a joint bid from Universal Distribution and Ad Populum which is the parent company of NECA and WizKids.

We’re awaiting any news coming from the court but the latest filings all have revolved around extending the timeline to object to the deal.

Titan Publishing files a Motion for Diamond to “Assume or Reject” its Distribution Agreement

Diamond Comic Distributors

In January 2025, Diamond Comic Distributors declared Chapter 11 and recently Alliance Entertainment won the bidding process to take over most of Diamond’s assets/operations. There are still a lot of questions like what Alliance’s plans are for the distribution of comics once their purchase is finalized.

Titan Publishing has filed an emergency motion to “compel debtors (aka Diamond) to assume or reject (its) distribution agreement with Titan Publishing Group, Ltd. by April 25.”

The short version, as I read it, this is a shit or get off the pot as to what the plan is post Diamond’s purchase.

Here’s the relevant sections:

  1. At this time, there are several deadlines under the Distribution Agreement which will occur before the end of the month. Namely, on or about April 26, 2025, Movant would typically provide Diamond with a list of Products to be released in July 2025, and, on April 29, 2025, Diamond would normally provide Movant with its orders for Products to be released in June, 2025. After these dates, there are recurrent weekly deadlines for the order process as many comic books are published on a weekly schedule.
  2. Upon termination of the Distribution Agreement, Movant is required to “remove at its own expense all Products held on consignment (‘Inventory’) from Buyer’s distribution center;
    unless Buyer has chosen to sell or remainder this Inventory to offset amounts due from Seller to Buyer.” Distribution Agreement, § 11(f).
  3. Movant requests that this court require Diamond to make a determination on assumption or rejection of the Distribution Agreement by April 25, 2025, with any such assumption or rejection effective on April 25, 2025.
  4. To the extent that Diamond elects to reject the Distribution Agreement, Movant shall be immediately entitled to refuse to fill any orders from Diamond placed April 25, 2025, or later, and to exercise its rights upon termination of the Distribution Agreement, including the reclamation of unsold Products.
  5. Upon the rejection of the Distribution Agreement, Movant requests that it be allowed to immediately terminate the Distribution Agreement, although Movant may, at its option, honor orders already placed by Diamond.

As we keep saying, there’s a lot more to go before this matter is settled and expect a lot more questions as far as contracts to go. You can read Titan’s full motion below.

Key Dates Set for the Diamond Chapter 11 Claim Process

Diamond Comic Distributors

As we were the first to report, the winning bid has been chosen when it comes to Diamond’s Chapter 11 process. But, there’s many steps to go before the matter is completely settled including the ability for objections to the deal to still be filed as well as getting in claims for those that are owed by Diamond. The information regarding the claim process has been released and you can check all of that out below:

Here are the key Bar Dates set:

For people, companies, basically anyone that’s not the government that’s a creditor to Diamond:

May 20, 2025 as the deadline (the “General Bar Date”) for each person or entity, other than a governmental unit, to file a proof of claim in respect of any prepetition claim against the Debtors, including, without limitation, any secured claim, unsecured claim, priority claim, or claim asserted under section 503(b)(9) of the Bankruptcy Code for goods delivered and received by the Debtors within 20 days before January 14, 2025 (the “Petition Date”), unless otherwise provided in this Motion;

The Government’s deadline is:

July 14, 2025, as the deadline (the “Government Bar Date”) by which a governmental unit must file a proof of claim in respect of a prepetition claim against the Debtors;

Some other key dates:

the later of (i) the General Bar Date or the Government Bar Date (as applicable) and (ii) 11:59 p.m. (ET) on the date that is thirty (30) days after the later of (A) entry of an order approving the rejection of any executory contracts or unexpired leases of the Debtors, or (B) the effective date of a rejection of any executory contract or unexpired lease of the Debtors pursuant to any Court order as the deadline (the “Rejection Bar Date”) by which an entity asserting a claim for damages against the Debtors arising from such rejection must file a proof of claim on account of such damages; and

the later of (i) the General Bar Date or the Government Bar Date (if applicable) and (ii) 11:59 p.m. (ET) on the date that is thirty (30) days following service of notice of an amendment to the Debtors’ schedules of assets and liabilities (the “Schedules”) as the deadline (the “Amended Schedule Bar Date”) for an entity whose claim is affected by such amendment to file, amend, or supplement a proof of claim with respect to such claim.

If you fall under any of the following, you need to submit a claim:

a. any person or entity whose claim is not listed on the Debtors’ Schedules;
b. any person or entity whose claim is listed on the Debtors’ Schedules as contingent, unliquidated or disputed;
c. any person or entity whose claim is improperly classified on the Debtors’ Schedules or is listed in an incorrect amount and who desires to have its claim allowed in a different classification or amount than identified in the applicable Schedules;
d. any person or entity who believes that its claim against the Debtors is or may be entitled to priority under section 503(b)(9) of the Bankruptcy Code for goods delivered and received by the Debtors within 20 days before the Petition Date;
e. any person or entity who asserts a claim arising from the rejection of executory contracts or unexpired leases of the Debtors and has not previously filed any such claim;
f. any person or entity who asserts a claim against the Debtors arising from or related to the purchase or sale of any security of the Debtors, including, without limitation, any equity security; and
g. any person or entity who asserts a claim arising from or relating to pending or threatened litigation against the Debtors.

The following don’t need to file a proof of claim:

a. any person or entity whose claim is listed on the Schedules, if (i) the claim is not listed as contingent, unliquidated or disputed, (ii) the person or entity
agrees with the amount, nature or priority of the claim as identified on the Schedules, and (iii) such person or entity agrees that the claim is an obligation of the specific Debtor that listed the claim in its Schedules;
b. any person or entity who has already filed with Omni or with the Clerk of Court a signed proof of claim against the Debtors utilizing Official Form B410 or a claim form that substantially conforms to such official form, including by providing all of the information required by such form and the procedures set forth herein;
c. any person or entity whose claim has been allowed by order of the Court entered on or before the applicable Bar Date;
d. any person or entity whose claim has been paid in full in accordance with an order of the Court entered on or before the applicable Bar Date;
e. any person or entity whose claim is based solely on owning an equity security in the Debtors;
f. any director, officer or employee of the Debtors who served in such capacity at any time after the Petition Date for claims based on indemnification, contribution or reimbursement;
g. any contract or lease counterparty whose contract or lease has been assumed or assumed and assigned by the Debtors; and
h. any entity whose claim is solely against any of the Debtors’ non-debtor affiliates.

You can read the full order below:

It’s official, Alliance Entertainment has been Approved to purchase Diamond Comic Distributors, Diamond Select Toys

We have the official word that Alliance Entertainment has been approved to purchase Diamond Comic Distributors and Diamond Select Toys. We had an initial hint earlier today but the official court documents have been released.

In a hearing Alliance and Diamond reached an agreement with the “respect to the sale of substantially all of the Debtor’s Assets to Alliance.”

Bandai Namco, The Pokémon Company International, Inc., and counsel to AIREIT Olive Branch DC LLC and Anson Logistics Assets LLC did not object to the order after doing so leading up to the hearing.

This is a breaking story and will be updated as we work through all of the documents below.

Is it Alliance Entertainment for the Win in the Diamond Chapter 11 Bidding?

Alliance Entertainment

In a stipulation to extend the period in which unsecured creditors may assert a challenge under the final dip order, it would seem that the cat is out of the bag and Alliance Entertainment might be the winner when it comes to the bid for Diamond Comic Distributors and their Chapter 11 filing.

The challenge to the final dipper order allows parties in interest, like creditors or a creditors’ committee, to object to the order and contest specific terms, such as the validity of prepetition liens or obligations.

In the order this stood out with the bold part the most interesting aspect:

WHEREAS, on April 8, 2025, the Court held a continued hearing (the “Sale Hearing”) on the Debtors’ Motion for Entry of an Order (I) Approving the Sale of Substantially All of the Debtors’ Assets Free and Clear of Liens, Claims, Interests and Encumbrances (II) Approving the Assumption and Assignment of Executory Contracts and Unexpired Leases; and (III) Granting Related Relief [D.I. 168], at which the Court indicated that it was prepared to enter an order approving the sale of substantially all of the Debtors’ assets to Alliance Entertainment, LLC (the “Sale”), upon the Debtors’ submission of a final form of order and revised asset purchase agreement consistent with statements made on the record at the Sale Hearing; and

On Monday, a hearing was held to nail down the final winning bid for Diamond Comic Distributors which declared Chapter 11 in January 2025. Alliance Entertainment was initially announced as the winning bid. On Saturday, in a shock, Diamond said it was going with a different bid which then led to objections to that from Alliance. Lots of bankruptcy drama! It has been quiet as to who won the bid until now.

It would seem that creditors have until April 25 when the sale hearing closes and this drama might be behind us… maybe…

Check out the full court document below.

Alliance submits a complaint over Diamond’s last minute switch to Universal in its Acquisition

Diamond Comic Distributors

The maneuvers continue and Alliance Entertainment has submitted a complaint over Diamond Comic Distributorsdecision on Saturday to reject Alliance Entertainment’s bid as originally announced and instead go with a joint bid by Universal Distribution and Ad Populum.

In the complaint, Alliance Entertainment claims they submitted the “highest and best” bid. It has been stated elsewhere that Universal and Ad Populum’s bid was higher.

It goes on to further state that Diamond has committed an auction that was unfair. In other objections to the initial decision in choosing Alliance, creditor parties said the auction was unfair in choosing Alliance and that there was higher bidders.

Alliance Entertainment still wants to close the sale transaction and court’s approval.

It would seem that Monday’s hearing is going to be an interesting one!

Alliance Entertainment releases its Witness and Exhibit List for its Diamond Bid

Monday is a big day with a bankruptcy court session focused on the bids and purchase of Diamond Comic Distributors. While many assumed Alliance Entertainment would win the process, a wrench was thrown into things yesterday when Diamond signaled it was going with the highest bid from Universal Distribution and Ad Populum.

Alliance isn’t going down without being heard it seems and has released its list of witnesses and exhibits its bringing to the hearing. You can see all of that below, none of it is really exciting, just a list with no real new details.

It just continues to show that things are up in the air still and this isn’t over until the court approves any deal(s).

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