Diamond Files for Chapter 11 Bankruptcy

Should have posted this earlier but forgot with all the different comic and gaming related things going on. Here’s the text straight from Diamond itself.

Dear Valued Customer,

I’m writing to share one of the most challenging messages of my career.

Earlier today, Diamond made the difficult but necessary decision to file for Chapter 11 bankruptcy. This step is intended to stabilize our financial foundation and protect the most vital aspects of our business.

This decision was not made lightly, and I understand that this news may be as difficult to hear as it is for me to share. The Diamond leadership team and I have worked tirelessly to avoid this outcome but the financial challenges we face have left us with no other viable option.

Chapter 11 will provide us with the opportunity to restructure and address our financial obligations. This process will likely include the sale of key assets of Diamond Comic Distributors.

We have already received a commitment from Universal Distribution to purchase Alliance Game Distributors coupled with a signed Letter of Intent to purchase Diamond UK, and we remain committed to pursuing offers for all Diamond lines of business.

What does this mean for you?

I want to reassure you that, with secured financing in place to support our operations, Diamond Comic Distributors is committed to continuing business as usual throughout this process.

Our plan is to continue fulfilling orders in a complete and timely fashion and we are working hard to minimize any disruptions to your orders.

We will be as transparent as possible during this process and will keep you informed of significant developments. If you have any questions, please reference the Retailer FAQs below, also available on our Retailer FAQs page on the Retailer Services Website. With further inquiries, as always, you can submit a ticket via our online Retailer Support Center or contact us at [email protected].

Thank you for your support. We are committed to your business and ensuring that your needs are met as we navigate this process.

Sincerely,
Chuck Parker
President, Diamond Comic Distributors

Now what specifically does this mean?

Chapter 11 of the United States Bankruptcy Code is a reorganization process that allows individuals, partnerships, and corporations to reorganize their finances. It’s often used when a business is more valuable as an operating entity than if it were liquidated.

So now they’re not going out of business completely but they are restructuring because they’ve lost a lot of clients. It’s definitely not looking GOOD for them but it’s still possible to pull out of this, get bought, etc.

This is definitely going to cause some shakeups, most notably the article I just posted yesterday about Vault self distributing, and I’m sure more to come. Looks like from articles at other outlets (ComicsBeat and ICv2) that they’re getting money from their bank to support them through the restructure and hopefully they are able to at least reorient themselves in the new environment they’re in now with a large number of their customers leaving for PRH or Lunar.