CHICKEN Soup for the Soul Entertainment (CSSE), known for its Chicken Soup for the Soul self-help book series, has filed for Chapter 11 bankruptcy protection in Wilmington, Delaware court.
After months of financial distress, the publishing company revealed in its bankruptcy petition that it has $414 million in total assets and a total debt that stretches out to nearly $1 billion, based on Reuters’ article.
The company also owes money to BBC and Sony Pictures, retailers Walgreens and Walmart, and over 500 other entertainment creditors.
Chicken Soup for the Soul Entertainment has filed bankruptcy protection in Wilmington, Delaware to fund its $20 million bankruptcy loan from Owlpoint Capital. However, the attempt was blocked by HPS Investment Partners to whom the company owed $500 million which was used to acquire Redbox.
Based on Deadline’s article, CCSE acquired Redbox, a DVD rental kiosk, from Apollo Global Management for 370 million dollars in mid-2022. This acquisition, with the initial plan to integrate Redbox’s DVD business and free streaming services, was unsuccessful as it took on nearly $325 million of debt in the company.
In a report by Deadline on June 29, CSSE passed on the message of the bankruptcy filing to its employees in response to the employees’ claims that they had been unpaid for nearly a week and their medical benefits had been cut.
“In connection with the filing, we have applied for approval of a debtor in possession [DIP] loan. Upon court approval, we expect payroll to be funded early in the week and funding for this upcoming week’s payroll to be secured. We also expect to have the funds to reinstate medical benefits back to May 14, 2024, and going forward. We will provide regular updates,” the message said.
On the other hand, according to CNN’s report, Chicken Soup for the Soul’s phenomenal self-help books is not affected by the bankruptcy filing in the company’s entertainment line of business.
In addition to their books, Chicken Soup for the Soul operates video-on-demand networks delivering themes like family, kids, faith, horror, and more; podcasting; positive journalism; and pet food based on their website.
With reports from Gella J. Aboratigue
