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150 creditors await Guvera’s grand plan at Thursday meeting
By Chris Cooke | Published on Tuesday 5 July 2016
As many as 150 creditors could show up at the Sydney offices of Deloitte on Thursday following the decision of streaming music company Guvera to put two of its companies into administration.
As previously reported, Guvera announced last month that Guvera Australia and Guv Services were now in administration after the parent company’s ambitious plan to IPO was blocked by the stock market where it hoped to float, the Australian Securities Exchange.
About 60 of the creditors are employees of the two subsidiaries who lost their jobs as the companies went into administration, though it is thought about a third of them may be offered work by the Guvera parent company, or another subsidiary, possibly including the newly incorporated Guvera Operations.
According to Computer Daily News, attendees at the creditors meeting on Thursday might also include some of the 3000+ smaller investors who are thought to have put money into the flagging digital music start up as clients of accountants signed up to a thing called the AMMA Private Equity network, which is connected to Guvera co-founder Darren Herft.
As previously reported, administrator Neil Cussen of Deloitte Australia told the Sydney Morning Herald last week: “Over the course of the next week we will be working with management to see if we can get a proposal that we can talk to the creditor group about in relation to a deed of company arrangement”.
It seems Guvera execs and their administrators hope that some deal can be struck to stop the two subsidiaries from actually going into liquidation, an arrangement which would also enable redundant staff members to collect any entitlements they are due.
A liquidation of Guvera Australia would pose some interesting challenges. Aside from it forcing employees to seek their outstanding entitlements from the Australian government’s Fair Entitlements Guarantee scheme, it’s thought that it is actually the Guvera Australia business that has the label and publisher licences to stream music in the country, and it’s not clear what would happen to them if that entity was wound down.
As also previously reported, Guvera chiefs Claes Loberg and Phil Quartararo last week posted videos to YouTube bigging up their business and countering all the bad press the failed IPO and subsequent administrations have caused.
They both insist that it is wrong to compare Guvera to Spotify and Apple Music, stressing that their core business is a free-to-access music platform aimed at more mainstream consumers who will never pay to stream. Guvera, they say, is chiefly in the advertising game, not the subscriptions business like most of its streaming music rivals.
Though The Sydney Morning Herald points out that an update to the Guvera app last month removed chunks of functionality to free users, encouraging them to sign up to premium to regain those services.
