B2B digital music services provider 7Digital is flirting with administration, the UK equivalent of bankruptcy, after investors rejected a plan to issue more shares for cash which the company says its needs to survive.
7digital Group Plc is a publicly traded digital music and radio services platform. 7digital offers both B2B services for digital media partners and 7digital branded direct-to-consumer music download stores.
$5.5 Million Needed By July 31st
7digital has said that it needs to raise a $5.5 million by July 31st or it was “highly likely that the company would need to be placed into administration.” Investor failure to pass the resolution, “therefore creates greater execution risk for any subsequent equity raise by the company since further shareholder approval would be required in order to implement this.”
“Clearly, the directors are extremely disappointed with this unsatisfactory outcome and therefore intend to engage with the relevant shareholders, where possible, with a view to securing their support for a follow-on financing,” said 7digital. 
eMusic To The Rescue?
In an effort to help save 7Digital, eMusic president Tamir Koch has offered $1,6 million of the $5.5 million needed . If the full unding is found, Tamir is “planning an ambitious mass market distribution project using 7digital’s blockchain platform,” according to a spokesperson.
But eMusic has had financial problems of its own.
In October of last year, The Orchard, Naxos and several other major and independent labels pulled their catalogs from eMusic “after “continued non-payment, as well as non-reporting.” As of Thursday, it did not appear that labels that left had returned to the platform.
7digital Group Plc shares fell 3.1% and were trading around $00.12 USD on the London stick exchange Thursday.
