It took a flurry of late night activity, and Judge Christopher Sontchi could decide to do whatever he likes when today’s hearing gets underway at 11:30 PST, but for now, it looks like Perseus has the upper hand in the battle for Publishers Group West and its client publishers. PW Daily reports that AMS lawyers and the unsecured creditors’ committee gave their support to Perseus’s offer to pay 70 cents of pre-bankruptcy claims to PGW clients. Perseus has signed contracts with publishers accounting for 85% of the PGW debt. Perseus CEO David Steinberger said he was “gratified” for the backing of the two parties and appreciated the support Perseus received from the publishers.
But National Book Network isn’t counting themselves out yet. CEO Jed Lyons announced the company is raising the payout to publishers to 100% of monies owed and dropping NBN’s $1.2 million claim against AMS, as well as another unsecured claim. NBN has agreements with 118 publishers, representing 42% of PGW clients, excluding Avalon, which is being acquired by Perseus.
And the 11:30 hearing will also address distributor Baker & Taylor ‘s plans to take control of the non-PGW-related bankruptcy holdings of AMS. Michael Cader noted in Publishers Lunch yesterday that “doing some reverse math” revealed some interesting findings. “In their January 24 court filing, [AMS] declared accounts receivable of $147.5 million and inventory of $72.5 million. But in the B&T letter of intent, accounts receivable have plunged to $65 million — implying that accounts have paid down their payables by returning up to $82 million worth of books.” That’s a whole lot of money unaccounted for, and it’s not even taking into account how much money Wells Fargo has first claim on. Radio Free PGW has much more on B&T’s offer and why, in his opinion, it’s the “recipe to make stinkbug pie.”