7Digital Flirts With Bankruptcy, eMusic Makes $1.6M Bet
B2B digital music services provider 7Digital is flirting with administration, the UK equivalent of bankruptcy, after investors rejected a plan to issue more shares for cash which the company says its needs to survive.
7digital Group Plc is a publicly traded digital music and radio services platform. 7digital offers both B2B services for digital media partners and 7digital branded direct-to-consumer music download stores.
$5.5 Million Needed By July 31st
7digital has said that it needs to raise a $5.5 million by July 31st or it was "highly likely that the company would need to be placed into administration." Investor failure to pass the resolution, "therefore creates greater execution risk for any subsequent equity raise by the company since further shareholder approval would be required in order to implement this."
"Clearly, the directors are extremely disappointed with this unsatisfactory outcome and therefore intend to engage with the relevant shareholders, where possible, with a view to securing their support for a follow-on financing," said 7digital. eMusic To The Rescue?