Velti Inc., a provider of technology for marketing on mobile devices, received court approval of a loan allowing the company to operate while it’s in bankruptcy.
U.S. Bankruptcy Judge Peter Walsh approved the interim financing today in Wilmington, Delaware. The company, which filed for bankruptcy yesterday, will return to court to seek approval of the rest of a $25 million debtor-in-possession loan from units of GSO Capital Partners LP, the credit division of Blackstone Group LP. (BX)
The $6.3 million in interim financing will be split between the businesses. The U.S. units will receive about $2.2 million and the remainder will go to the U.K. units.
Velti, a San Francisco-based unit of Velti Plc (VELT), listed assets of as much $50 million and debt of as much as $100 million in Chapter 11 documents filed this week. Its Air2Web Inc. unit, based in Atlanta, also sought creditor protection. Velti Plc, which trades on the Nasdaq Stock Market, isn’t part of the bankruptcy process.
The company plans to auction some assets with an affiliate of GSO Capital Partners acting as the initial, or “stalking-horse,” bidder.
While the business lines of Air2Web’s India unit and Velti’s U.K. operations, including Mobile Interactive Group Ltd., are included in the proposed sale, those entities aren’t part of the bankruptcy and are continuing normal operations, Velti Chief Executive Officer Alex Moukas said in a phone interview before the filing.
A hearing to approve bidding procedures in connection with the sale of the business lines and approve GSO as the stalking-horse bidder in the bankruptcy auction is now scheduled for Nov. 18. The matter was on the agenda for today’s hearing and was postponed at the request of lawyers for Velti to allow time for a creditors committee to be formed.
The case is In re Velti Inc., 13-bk-12878, U.S. Bankruptcy Court, District of Delaware (Wilmington).
To contact the reporter on this story: Dawn McCarty in Wilmington at firstname.lastname@example.org