Gay Media in Receivership
Posted on February 9, 2009
Filed Under Uncategorized
The investment fund that owns the Washington Blade, the Southern Voice, Genre magazine, and other gay publications has been forced into receivership by the federal Small Business Administration (SBA), which will sell the fund’s assets and distribute the proceeds to investors.
“As a consequence of defendant’s continuing violation… SBA is entitled to the injunctive relief… including the appointment of SBA as receiver of [the Avalon Equity Fund],” the SBA wrote in an August 2008 court filing, which was only recently found by Gay City News.
Avalon, which owns a stake in the company that publishes the New York Blade and HX, was licensed by the SBA as a small business investment company (SBIC) in 2000. Through 2007, it borrowed just over $38 million from the federal agency to invest in gay media properties and a range of other ventures.
As part of its contract with the SBA, Avalon was required to have private money or assets in the fund from sources, such as individual investors, that had a value equal to half the amount it borrowed from the SBA or just over $19 million. See Gay Media in Receivership
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