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Guvera teeters on the brink after ASX refuses listing

Advertising-funded music streaming service Guvera has been dealt a potentially lethal blow with the Australian Securities Exchange refusing it permission to list.

The decision by the ASX means Guvera will no longer be able to run its planned initial public offering with which it aimed to raise $80m.

guvera

This afternoon’s announcement that the ASX has decided not to allow the float to go ahead leaves Guvera with no obvious means of continuing to trade given its high levels of debt.

A statement from Guvera, which would have had the ASX designation GUV, said that it is “reviewing its legal options and obligations”.

The directors of Gold Coast-based Guvera will be legally obliged to put it into administration if they do not believe the company has the means of covering its debts.

The decision by the ASX came just hours after the Australian Securities and Investments Commission clipped Guvera’s wings, forcing it to issue a replacement prospectus for the float.

If the fund-raising had gone ahead, it would have valued the company at $655m, despite having revenues put at just $1.2m in the last financial year. According to its prospectus – now removed from the Guvera website – the company lost $81m in the last financial year and lost $55m in the first half of this financial year.

Prior to the IPO the company had mainly raised funds – put at more than $100m over the last few years – mainly by selling shares to small self managed superannuation funds.

The company’s CEO is Darren Herft, who also owns AMMA Private Equity, which had led this sales process.

darren herft

Herft. Source: LinkedIn

If the company does not survive, it is likely the super funds will lose most of their investments.

The company’s chairman is former Warner Brothers CEO Phil Quartararo.

Recent weeks saw respected players in the financial community question the basis of the listing, with former Groupon boss Rob Solomon labelling it “insane”.

Claes Loburg, Guvera’s president, tonight tweeted that it had been the most stressful week of his life.

Guvera’s announcement:

Guvera Limited (Guvera) has received correspondence from its lawyers, Arnold Block Leibler (ABL), regarding a letter received from the ASX today advising that it has exercised its discretion to refuse the applicant (Guvera Limited) admission to the official list of the ASX. The ASX has offered to meet with Guvera next week to discuss its decision.

Guvera is currently reviewing its legal options and obligations and will be communicating to the market when it is more informed about the position and course of action the Company can take.

About Guvera

Guvera is an award-winning international music streaming and entertainment company. The company operates at the intersection of the digital music and mobile advertising industries, with a business focus on high-growth, emerging markets. Guvera’s vision is to offer a genuinely engaging advertising platform to brands that enables access to music and entertainment content for users, while ensuring that artists and rights holders are fairly rewarded for the work they produce. www.guvera.com /

www.guvera.com/brands / www.guveralimited.com

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