TMP Case Summary – Online Digital Media Streaming Company

Our client, a start-up company, was a unique provider for online streaming of digital media content. Although the company was very young, it had converted some key blue chip accounts with potential for rapid growth.

Online streaming is a competitive and growing business as can be seen from companies such as Lovefilm and Netflix.

Factors leading to business distress

- Start-up development costs exceeding budgets
- Technical glitches with early beta tests
- Fragmented management team
- Changes needed to the original business model
- Pressure from key creditors, and
- Withdrawal of funding from majority funder due to the internal issues

Outcome

- TMP advised on a Pre-Packaged Administration sale of the business and assets
- A marketing exercise was carried out involving key competitors, creditors, directors, investors and the market at large
- An in-principle deal was agreed just as the company entered Administration
- The deal involved cash consideration, debt write-down and payment of the Administrator’s fees and expenses
- This meant a small distribution was possible to creditors who otherwise would have received no repayment
- Employees kept their jobs, overheads were streamlined, and an experienced management team was brought in to run the restructured business
- New funding was provided to get the restructured company through the next critical phase

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