Edgio Inc., the content delivery company formerly known as Limelight Networks, is seeking bankruptcy court approval to wind down its subsidiaries in France and the Netherlands, as the company finalizes its restructuring following multiple asset sales.
In a motion filed April 15 with the U.S. Bankruptcy Court for the District of Delaware, Edgio requested authority to initiate dissolution proceedings for Edgio France S.à r.l. and bankruptcy proceedings for Edgio Netherlands B.V. The filing represents another step in streamlining operations as the company prepares to emerge from Chapter 11 protection with a significantly reduced footprint.
"With limited exceptions, the Non-Debtor Subsidiaries, including Edgio France and Edgio Netherlands, no longer conduct any business activity, and their continued existence is unnecessary to support the future operation of Uplynk by the reorganized Debtors," the company stated in its filing, referring to the streaming video platform that will form the core of its post-bankruptcy business.
Edgio commenced its Chapter 11 cases to conduct an expeditious sale process for its assets. Over the first three months in bankruptcy, the company completed several sales, including the divestiture of its Apps and Content Delivery businesses to Akamai Technologies, Inc. The company also agreed to sell its Uplynk business to an affiliate of Lynrock Lake Master Fund, Edgio's DIP lender and prepetition lender, which will be implemented through a Chapter 11 reorganization plan filed on April 1, 2025.
The motion explains that under French law, Edgio must execute a shareholder consent before Edgio France can commence a "dissolution anticipée" (early dissolution). Similarly, Dutch law requires a statement confirming the authority of Edgio's representative to declare Edgio Netherlands "failliet" (bankrupt) under Article 1 of the Dutch Bankruptcy Act.
"If the Non-Debtor Subsidiaries continue in existence indefinitely, they will require funding from Edgio for ongoing expenses such as corporate registration and the preparation and auditing of financial statements," the company explained in its filing. Additionally, Edgio warned that "if a disorderly liquidation leaves the Non-Debtor Subsidiaries insolvent, then their directors may become personally liable for their respective debts and would look to Edgio and its insurance policies for indemnification."
The filing emphasizes that the motion is supported by both Lynrock and the official committee of unsecured creditors. It also notes that certain non-debtor subsidiaries in Canada and Singapore will continue to operate following the reorganization to preserve tax attributes and facilitate ongoing operations of the Uplynk business.
According to the motion, Edgio believes that executing shareholder consents for these foreign proceedings falls within the ordinary course of business, but the company is seeking court approval "out of an abundance of caution." The motion does not seek authority to transfer additional funds from the debtors to the non-debtor subsidiaries beyond what is already permitted under previous court orders.
A hearing on the motion is scheduled for May 6, 2025, with objections due by April 29, 2025.
Edgio and its affiliated debtors are represented by Richards, Layton & Finger, P.A. in Delaware and Milbank LLP in New York. The case is being heard by Judge Karen B. Owens in the Delaware bankruptcy court as Case No. 24-11985 (KBO).
This article was prepared using Stretto Conductor, our new AI-powered assistant that's here to help. Stretto Conductor was able to create this summary of a 9 page court filing in less than a minute. Always review the underlying docket filings for accurate information. The information and responses generated by Stretto Conductor may contain errors or inaccuracies and should not be relied upon as a substitute for professional or legal advice.