Guvera held its creditors meeting and it’s not looking good

Troubled Australian music streaming service Guvera held its first creditors’ meeting in Sydney yesterday. It failed to deliver an expected rescue plan.

However administrator Neil Cussen of Deloitte Restructuring, at whose Parramatta offices the meeting was held, is expecting the deed of company arrangement (DoCA) to be resolved shortly.

“We remain in discussions with (Guvera) management on this and hope to receive something towards the end of next week,” Cussen said.

“We advised creditors that we are aware of a private placement memorandum that has been placed before Guvera Ltd shareholders and investors which seeks to raise around $10 million in the short term to support the DoCA proposal.”

A second meeting of creditors is scheduled for August 1.

The Gold Coast-based digital company is expected to deliver a plan on how to pay 60 ex-staffers and creditors of the two Guvera subsidiaries, which were put into administration by the parent company. The two owed a reported $15 million after ASX rejected a proposal for a $300 million Initial Public Offering valuing the group at over $1 billion.

Cussen said that his firm would then come up with a recommendation on the future of the subsidiaries, Guvera Australia and Guv Services.

Both Deloitte and Guvera are hoping not to see the subsidiaries go into liquidation, so that staff can access their entitlements and protect the company’s music licensing deals with labels and publishers.

The full total due to ex-staffers is not confirmed. But there are claims of $467,000 excluding superannuation and redundancies.

Former staffers at the meeting told Deloitte that they wanted a one-off lump sum than an extended repayment plan. “I just don’t have a great deal of confidence,” said one.

Guvera is already facing a £10 million (A$17.23 million) claim from 80 retrenched staff from its UK outfit Blinkbox after it was wound up in June 2015.