Industry rumblings were confirmed this morning as Diamond Comic Distributors filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Maryland.
Once the undisputed king of comic book distribution with a near-monopoly on the business, Diamond has been a staple in the comic shop and specialty retail industries for over 40 years. Under Chapter 11, the company plans to restructure its business. The move comes after struggles that came to light during the COVID-19 pandemic and moves by major publishers, including DC, Marvel, and Image Comics, to alternate distribution channels.
In the toy and game space, Diamond is a major distributor to the specialty market and a manufacturer through Diamond Select Toys. In a letter sent to partners and viewed by The Toy Book, Diamond President Chuck Parker called today’s news one of the most challenging moments of his career.
Diamond secured up to $41 million in debtor-in-possession (DIP) financing from JP Morgan Chase that will be used to fund post-petition expenses and business operations. Additionally, an affiliate of Universal Distribution put forth a $39 million stalking horse bid for Diamond’s Alliance Game Distributors business unit. It also issued a non-binding letter of intent to purchase Diamond UK.
“Diamond has been a linchpin of the comic book industry for over four decades. Our priority has always been to provide quality service to publishers, retailers, and, ultimately, comic fans, and we remain committed to finding additional buyers for our businesses,” said Parker says.
The company is exploring the sale of its other business units, including Diamond Book Distributors, Collectible Grading Authority, Diamond Select Toys, and its main comic, toy, and collectible distribution lines.
Additional information is expected to emerge in the days ahead.
