7digital faces 'entering administration by July 31'

7digital faces 'entering administration by July 31'

7digital’s directors have revealed that the company could be heading into administration by the end of July.

According to a statement issued to the Stock Exchange following the b2b music service’s AGM, the company needs to raise £4.5 million by July 31 to avoid entering administration. 

New York-based eMusic president Tamir Koch made a majority investment of £1.3m in 7digital earlier this week.

However, the company’s investors rejected a plan at the AGM to issue more shares for cash. 7digital said that makes administration a real possibility.

“The company currently believe that it still needs to raise additional funds of at least £4.5 million by 31 July 2019, failing which it is highly likely that the company would need to be placed into administration,” said a statement. 

It added that directors are “extremely disappointed” with the rejection of the plan by shareholders. 7digital will now engage with investors with a view to securing their support for a follow-on financing.

Last summer 7digital was forced to apologise for a "lengthy delay" in publication of its financial results

author twitter FOLLOW Andre Paine

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