SSL to acquire C2W Music in reverse takeover
SECURITIES DEALER Stocks & Securities Limited will execute a reverse takeover of loss-making music publisher C2W Music through SSL Venture Capital Jamaica Limited, a nascent subsidiary used as a vehicle for investments.
SSL Venture is essentially acquiring C2W Music as a shell from which to operate. The music publisher will be renamed SSL Ventures Capital Limited once the transaction is finalised, but the change is subject to shareholder approval. The renamed firm will trade on the stock exchange as SSL Ventures.
Another extraordinary meeting for that vote is scheduled tentatively for July.
A reverse takeover involves a private company acquiring the controlling shares in a publicly traded one, in a move aimed at taking over the public company and recapitalising it. But it also allows the private company to fast track its listin.
The rescue programme for C2W, which has been approved by regulators, was itself outlined and approved at the board level of the companies prior to the extraordinary meeting on Wednesday. The top two shareholders and principals of the company, Ivan Berry and Derek Wilke, did not participate in the meeting.
“We are basically buying C2W Music and then injecting capital and changing the business operation,” said SSL Ventures CEO Drew Gray at the meeting held at the Jamaica Stock Exchange in Kingston.
SSL Venture Capital is already capitalised with US$850,000 but will go back to the market to raise additional funds in order to finance future deals. C2W, meanwhile, last reported negative equity of US$236,000.
Gray indicated that SSL Venture should post earnings per share of $0.05 in its first year. Comparatively, C2W Music had negative earnings per share, having posted a full-year net loss of US$323,000.
“The current board and management team has already decided to step down as part of the rescue mission. Also we will amend the company articles of