Update re. investment in THEVIBE Ltd

RNS Number : 4307N

Vela Technologies PLC

09 May 2018

 

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR")

9 May 2018

Vela Technologies plc

("Vela" or the "Company)

Update re. investment in THEVIBE Ltd

The Board of Vela (AIM: VELA), the investing company focused on early stage and pre-IPO disruptive technology investments, is providing an update to shareholders regarding its investment in THEVIBE Ltd (trading as Vibe Tickets) ("Vibe Tickets"). The last fund raise completed by Vibe Tickets in October 2017, resulting in Vela owning a 5.1% shareholding in Vibe Tickets at a total cost of of £400,000, was carried out to provide additional working capital and to enable Vibe Tickets to expand its offering into new verticals; build up its user base and enable Vibe Tickets to add to its headcount. These objectives have been achieved by the company.

The funds raised in October 2017 by Vibe Tickets represented broadly 6 months of future cash requirements during which time it was anticipated that discussions with new investors and existing shareholders would result in Vibe Tickets being able to raise further funds of in excess of £1m. Vibe Tickets is a pre-revenue business at the present time.

During these discussions between existing shareholders and new investors it  became clear to the board of Vibe Tickets that there was a requirement to restructure the Vibe Tickets business in order to attract more substantial funding from investors.

As a result it has  not been possible for Vibe Tickets to reach agreement on the terms of a further fundraise with investors. The Board of Vibe Tickets therefore had no alternative but to seek advice which required the directors to act in the interests of both creditors and shareholders, resulting in THEVIBE Ltd being placed into administration on 30 April 2018.

Vibe Tickets has subsequently been purchased from the administrators by Luke Massie, the former Chairman of THEVIBE Ltd.

Luke Massie has formed a new holding company, Vibe Group Holdings Limited ("VGHL"). In the coming weeks, it is expected that VGHL will acquire 100% of Vibe Tickets and 90% of Vibe Pay. The remaining 10% equity holding in Vibe Pay will be owned by key management  of Vibe Pay. It is the intention that further funds will be raised by VGHL.

Information about VGHL

VGHL will consist of the following 2 businesses.

Vibe Tickets is a peer to peer social community with a marketplace at its core, connecting fans, allowing them to cut out the middle man and save fees. A company competing directly with the big four operating in the space; Viagogo, Seatwave, StubHub, GetMeIn. Vibe is fast becoming the resale platform of choice for consumers and has now grown to over 84,000 active users organically.

Vibe Pay is a peer to peer payments platform offering direct to bank money transfers. Vibe have built APIs which sit directly in-between the banking (open banking) infrastructure (rails) and the consumers. Vibe has built trust with its users and now moves towards owning the relationship between its users directly as opposed to sending them to other third party solutions. VGHL's plans and proposed investment by Vela in VGHL

Following completion of the above restructuring of Vibe Tickets further investment is expected to be committed to VGHL from Scott Fletcher (£500,000) and Vela Technologies (£200,000). Should Vela proceed with the new investment in VGHL, Vela  would retain a minority interest in VGHL. The new structure is also expected to enable VGHL to raise further capital in due course.

At this stage there can be no guarantee that this further investment by Vela will complete nor the timing or the terms of such investment. A further announcement will be made by Vela at the appropriate time with regards to the proposed investment in VGHL.

Antony Laiker, Executive Director of Vela, commented:

"We have supported Luke Massie and Vibe Tickets since 2016. We saw the opportunity to support a business that was both highly disruptive and would enable ordinary fans of music and sport, who were being forced to pay excess fees on top of inflated prices, to benefit from a transparent social media platform to buy and sell tickets. Vibe has made strong headway reaching over 84,000 users and has generated over £7m of ticket volume, all with minimal marketing spend. Vibe Tickets is doing what it set out to do - disrupting the big players.

Various financing routes for Vibe Tickets were explored. However, the corporate structure surrounding Vibe Tickets did not lend itself to securing further funding. Based on previous discussions with the management of Vibe Tickets, we anticipate that the "restructured" Vibe business will provide the platform for Vibe  to engage with parties who have expressed interest in supporting and growing the business further."

For further information, please contact:

Vela Technologies plc                                         Brent Fitzpatrick, Non-Executive Chairman

Antony Laiker, Director                                          Tel: [phone]      

Allenby Capital Limited (Nominated Adviser)        Tel: [phone]

Nick Athanas/Asha Chotai              

Smaller Company Capital Limited (Broker)         Tel: [phone]

Rupert Williams/Jeremy Woodgate
 

 

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