A bid by Kevin Lee, co-founder and executive chairman of Didit, has set a floor price for other potential buyers in a bankruptcy auction, according to people familiar with the matter.
As part of the settlement approved by Judge Stuart Bernstein of the U.S. Bankruptcy Court in New York on Thursday, Thiel Capital LLC agreed to drop its bid to buy Gawker and its archives and also agreed to release claims against any eventual buyer.
The settlement was originally proposed when Thiel abandoned his effort to buy the defunct site last month.
"We remain interested in Gawker.com and if we prevail, (we) plan to relaunch Gawker as Gawker For Good, using ad revenues to donate to non-profits," Lee, a search engine marketing expert, said in a statement.
Lee declined to comment on making the initial offer to buy the site in the upcoming bankruptcy auction.
The sources requested anonymity to discuss a matter that was not public.
Gawker did not immediately respond to a request for comment.
In 2012 Thiel helped fund a lawsuit filed by professional wrestler and actor Hulk Hogan against Gawker after it published a video showing Hogan, whose real name is Terry Bollea, engaged in a sexual encounter. Bollea won a $140 million (£103.5 million) judgement against Gawker, leading to its bankruptcy.
Hogan later settled for $31 million, and is entitled to 45 percent of the proceeds from asset sales, according to court papers.
After Gawker's bankruptcy, some of the website's related businesses, including the Deadspin sports website and feminist blog Jezebel, were bought by Univision Holdings Inc, the Spanish language broadcaster, for $135 million in 2016.
(Reporting by Jessica DiNapoli in New York; Editing by Clive McKeef)
By Jessica DiNapoli
