Struggling technology firm Ve Interactive, once thought to be worth at least £1bn, was bought by its new management team for just £2m, in what is thought to be a pre-packed administration.
The AdTech firm also made headlines last month after it surfaced that its former CEO and founder David Brown had stepped down and had been replaced by Morten Tonnesen. It’s believed Brown continues to act as an adviser.
The management buyout was reportedly backed by a consortium of existing significant shareholders and creditors who provided the funds to ensure the long-term security of the business.
Ve Interactive, which has repeatedly failed to hit targets for profit and revenue, is thought to employ almost 1000 people across its 36 different offices. The spokesman said the buyout would allow the group to “safeguard hundreds of jobs”.
According to an FT article, the company never received any VC funding, having instead raised approximately £50m from about 500 individuals.
To date, Ve Interactive has used that investment to complete seven acquisitions with the latest one thought to have closed in December last year, after it paid £3m for advertising firm Crave & Lamb.
Concha PLC, which paid £4m for a 0.43% stake in Ve in March last year, said in a statement that its board was “deeply disappointed by the recent events and circumstances of the last few months, particularly the actions of both the founder management team and their advisors”. The statement continued: “We together with other former shareholders in Ve, which in combination have advanced more than £50m in equity funding since the company began trading in 2009, will continue to investigate the actions of those responsible for its demise and indeed any opportunity to participate in the assets and business of Ve going forward, however at this time there can be no guarantees of any such involvement.”
Concha’s shares increased by 24.4% to 0.180p after it released its statement.
Ve’s management buyout was led by a consortium known as Rowchester Limited, which includes the firm’s new CEO Martin Tonnessn and COO David Marrinan-Hayes.
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