Getty Images said investor disputes contributed to its bankruptcy, with about $200 million in existing legal judgments, up to $275 million in potential future liabilities and $35 million in legal fees over four years. The company filed with $1.46 billion in debt and $20 million in cash.
Getty Images’ bankruptcy attorney said investor disputes helped accelerate the company’s bankruptcy, with about $200 million in existing legal judgments and up to $275 million in potential future liabilities. The company also spent $35 million on legal fees to contest investor claims over the past four years.
Investors alleged Getty Images breached agreements that would have let them acquire shares for $11.50 each. Getty blocked the investors from exercising warrants when the share price briefly reached $32 and has lost two lawsuits over the warrants. The company paid $110 million to two large investors in April after losing a federal case and appeal, and recently lost another case resulting in a $92 million judgment it has not paid.
Getty Images filed for bankruptcy with $1.46 billion in debt and $20 million in cash, citing the investor litigation, high debt and a failed merger with Shutterstock. Its restructuring agreement would cancel existing equity and make the company private, owned by affiliates of the Getty family and Koch Equity Development, which have agreed to invest $533 million. Creditors holding 90% of the debt support the deal, while shareholders plan to seek a court-appointed equity committee.
