€10.5m survival plan approved for company behind Joe.ie website
The High Court has approved a survival scheme for a digital media company behind the social news website Joe.ie.
Mr Justice Michael Quinn approved the scheme yesterday for Maximum Media Network (MMN) Ltd involving a €10.5m investment which will come into force tomorrow.
Greencastle Acquisition Ltd, a newly incorporated Irish company whose sole shareholder is Linton Capital LLP, is to make a combined investment in MMN which is behind Joe.ie and its UK subsidiary.
Totalling €10.5m, it includes a €300,000 investment in a share subscription in MMN, the assumption of the company’s secured liability through a loan agreement with the secured creditor, and the availability of up to €2m in working capital facilities.
The UK subsidiary was also acquired by Greencastle out of administration in that country.
Yesterday, Ross Gorman BL, for the examiner, said the scheme required ministerial go-ahead and approval from the Competition and Consumer Protection Commission (CCPC), both of which had been forthcoming.
Last May, the court heard MMN, which employs 48 people, had run into significant solvency and financial issues which led to main creditor BPC Lending Ireland, owed more than €6m, to seek the appointment of an examiner.
The court appointed Shane McCarthy of KPMG as examiner.
The court heard the €6m debt to BPC Lending represented some two-thirds of the firm’s entire debt.
Revenue, which was owed €460,000, and the landlord, BCP Fund Management (not connected with BPC Lending) which said it was owed €187,000 in rent arrears, did not oppose the examinership as long as current liabilities to them were paid during the term of the examinership.
The court heard one of the factors in the downturn in the fortunes of MMN, which had only become loss making in 2018 and enjoyed 42 million “hits” per year on its platforms, was a controversy last year when it was revealed a company employee used a “click farm” to artificially inflate engagement numbers.
Click farms involve a large group of low-paid workers being hired to click on paid advertising links.