Gawker Media is filing for Chapter 11 bankruptcy and is entertaining bids for sale, according to an individual who was briefed on the plan of action.
Speaking on condition of anonymity to the New York Times, the source revealed that digital media company ZiffDavis has submitted an opening bid of between $90 million to $100 million.
Gawker’s finances were hit hard after a judge awarded Hulk Hogan, whose real name is Terry Bollea, $115 million in punitive damages for having published a sex tape with him and a friend’s wife back in 2012. Another $25 million was also awarded to Hogan a week later, bringing the total to $140 million.
It was revealed that the lawsuit was partly funded by Peter Thiel, the Californian tech billionaire. The co-founder of PayPal declared that crushing Gawker in court was “one of my greater philanthropic things that I’ve done,” as Gawker “ruined lives for no reason.”
A massive drop in web traffic only compounded Gawker’s problems. In April this year, unique user numbers shot down to 44.4 million – its lowest since December 2013 and representing a 41% drop compared to the same month last year.
The person who leaked the sale details declared that the reason for bankruptcy was to “protect jobs and ensure continued operations.” Gawker still plans to appeal the Hogan case.
Jack Hadfield is a student at the University of Warwick and a regular contributor to Breitbart Tech. You can follow him on Twitter here: @ToryBastard_.