Breaking news: Prime Media Group have placed digital media company destra in voluntary administration on Thursday following the collapse of salvage bids to sell destra’s profitable assets including Magna Pacific.
It is understood that key destra financial backer the St George bank appointed Korda Mentha’s David Winterbottom and Richard Brereton as receivers and lead managers while Prime appointed PPB as administrator of destra and its subsidiaries.
Destra executive chairman and Lexion Partners principal David Gordon issued a statement to the ASX on Thursday morning requesting a trading halt and stating “that given the current economic environment, the Board has expedited urgent discussions with its bank to determine the best course of action in the interest of all stakeholders. The Company is also in discussions with trade buyers for various of its assets. It is not possible at present to give an indication of the expected outcome or timing of those discussions.”
By 12.30 pm both Korda Mentha and PPB had been appointed. A spokesperson for Korda Mentha said that they would be contacting shareholders and interested parties in the next couple of days.
The company was plunged into voluntary administration following confirmation from Prime Media Group and destra’s bankers that they are withdrawing from future financial support. Prime informed the market earlier in the day that in the event of administration and that there is found to be no value for equity holders, it as likely that Prime will write-off its entire investment in destra, estimated to be $9 million.
Interested parties in the distressed assets include Destra founder Domenic Carosa who was ousted by majority shareholder Prime Media Group in April. “I feel sorry for the destra team and I continue to maintain a watching brief on the progression of the companies assets,” he told Digital Media today. Carosa recently secured the assets of destra’s initial core business MP3.com and is currently in acquisition mode for further synergistic digital assets.
Meanwhile, destra assets such as Brand New Media, Magna Pacific and destra music which includes dance label Central Station Records, discount DVD company Rajon and world music distributor MRA should flush out a number of buyers including broadcasters, digital agencies and online retailers who had been courting the assts for months but unwilling to pay the price insisted by Lexicon Partners and Prime Media group.