TIDMYOLO
RNS Number : 4379O
YOLO Leisure & Technology PLC
07 November 2016
YOLO Leisure and Technology plc
("YOLO" or the "Company")
GBP2.5 million new equity placing
Investment in Magic Media Works
YOLO has successfully raised GBP2.5 million (before expenses)
through an oversubscribed placing ("Placing") of 250,000,000 new
ordinary shares of 1p each with new and existing investors at an
issue price of 1p per share ("Placing Shares"). Under the Placing,
each Placee will also receive one warrant for every five Placing
Shares subscribed for as part of the Placing, exercisable at 1.3p
per share ("Warrants").
In addition, the Company will invest approximately GBP1.4
million in Magic Media Works Limited ("Magic Works") through
secured convertible loan notes ("Loan Notes"). Magic Works has
developed the Electric Jukebox ("Electric Jukebox"), a premium
ad-free music streaming service and associated player. The
remainder of the funds raised will be used to provide the Company
with additional funds for working capital and investments.
Magic Works has developed a number of subscription-free music
streaming products and services which allow users to access ad-free
music content without the requirement for account registration,
passwords, software downloads or pairing of third party streaming
devices.
Magic Works has entered into licensing agreements with the
world's major record labels, including Universal Music Group, Sony
Music Group and Warner Music Group and major independents including
Merlin Music and also the major music publishers, allowing users to
access millions of albums and over 29 million music tracks ad-free.
Streamed music content is accessed via Electric Jukebox, a
proprietary streaming device developed by Magic Works. With a
typical set-up time of less than two minutes and a potential
addressable consumer market of some 800 million users worldwide
(Source IFPI), Magic Works is currently the world's only dedicated
music streaming developer of consumer music streaming players and
services that provide on-demand ad-free access to a wide ranging
music catalogue without the need for either a user account,
application download or a monthly subscription.
Magic Works has signed up a number of celebrities to assist in
marketing Electric Jukebox, including Robbie Williams and his wife
Ayda Field, Stephen Fry, Sheryl Crow and Alesha Dixon, all of whom
have equity interests in the business. It is intended that the
Magic Works streaming products and services will initially be
launched in the UK this month extending to the U.S. and Continental
Europe during 2017.
The Loan Notes shall bear an interest rate of 10% per annum from
1 March 2017 and are secured by a first ranking debenture over the
assets of Magic Works. The Loan Notes are convertible into
approximately 41.2% of the ordinary share capital of Magic Works on
a fully diluted basis. The conversion rights attaching to the Loan
Notes expire on 31 December 2018.
Simon Robinson, CEO of YOLO said: "The oversubscribed fundraise
of GBP2.5 million demonstrates the support and confidence of
existing shareholders in this transaction, including Nigel Wray,
and new institutional investors. The capital raised will enable
Magic Works to launch Electric Jukebox in the UK and accelerate
their strategic expansion into new territories and markets. The
fundraise also significantly strengthens YOLO's balance sheet."
Rob Lewis, Founder and CEO of Magic Media Works said: "This
latest funding secured with YOLO gives Magic Works the opportunity
to bring its range of fun and easy to use Electric Jukebox products
to music consumers around the world. We have the opportunity to
grow the market dramatically as we introduce new audiences to music
streaming in the home and open up new markets internationally.
Magic Works looks forward to bringing music streaming back into
people's homes and lives with Electric Jukebox."
Further Information
About Electric Jukebox
The Electric Jukebox provides a fun and user-interactive music
streaming experience that family and friends can share and enjoy
together. Electric Jukebox combines gesture and voice-enabled
user-interactions with a simple, intuitive user-interface enabling
easy navigation of Electric Jukebox's wide ranging music catalogue
in a manner unlike any other music device or service.
Electric Jukebox is a "plug and play" music streaming device
that connects to a television via an HDMI port and is then
controlled through a dedicated voice activated and motion sensitive
hand-held controller. Each Electric Jukebox product is designed to
be as simple to set up and use, with no smartphone, tablet or
monthly subscription required. Existing speakers owned by the
consumer can be utilised.
The simplicity of this "appliance-led" experience is core to the
Magic Works market proposition and is intended to offer consumers
who may not have adopted either free or premium music streaming the
opportunity to experience it easily, affordably and without the
need for a significant understanding of computing technology and
applications.
Magic Works is developing further Electric Jukebox devices with
launches scheduled for 2017.
Independent market research carried out by YouGov on behalf of
Magic Works suggests that over 90% of UK internet users have yet to
adopt the paid-for on-demand music streaming format, even though
most analysts expect it to be a primary means of music consumption
going forward. As such, Magic Works has an opportunity to
capitalise on an addressable market of hundreds of millions of
consumers internationally with what is a heavily differentiated
consumer proposition.
Magic Works intends to execute upon a number of marketing, PR,
retail, etail and TV shopping initiatives to maximise consumer
awareness of Electric Jukebox and to ensure successful initial
sales of the product. Further announcements will be made by the
Company in this regard in due course.
Advisory board
Magic Works has established an Advisory Board whose members
include Alain Levy (previously CEO, EMI), Mark Gretton (previously
founder CTO, Tom Tom), Paul McGuinness (previously manager, U2),
David Munns (previously CEO, EMI North America), Stephen Hornsby
(EU and competition lawyer and partner at Goodman Derrick LLC),
Peter Cornell (partner, Metric Capital), Mark Atkinson (previously
partner, Deloitte), Ken Daly (CEO, JML) and Jez Bell (Chief
Licensing Officer, PPL).
About the Placing
Application has been made to the London Stock Exchange for the
Placing Shares to be admitted to trading on AIM. It is expected
that admission of the Placing Shares will become effective on 8
November 2016.
8.4 million Adviser Fee Shares to the value of GBP84,000 were
issued to Advisers on this transaction at the Placing Price of 1p
per share at the time of completion of the Placing.
The Placing Shares and the Adviser Fee Shares will rank pari
passu with the existing ordinary shares in YOLO in all respects.
Following the admission of the Placing Shares and the Adviser Fee
Shares, the total issued share capital of the Company will be
437,322,758 ordinary shares, each with voting rights. The above
figure may be used by shareholders as the denominator for the
calculations by which they will determine if they are required to
notify their interest in, or a change to their interest in, the
Company, under the Disclosure and Transparency Rules.
Certain Directors of YOLO intend to subscribe for approximately
GBP40,000 of new ordinary shares in the Company following this
announcement on the same terms as the Placing. The details of the
subscription will be announced separately in due course.
-Ends-
The announcement contains information which, prior to its
disclosure, was inside information for the purposes of the Market
Abuse Regulation.
YOLO Leisure and Technology www.yoloplc.com
plc
Simon Robinson simon.robinson@yoloplc.com
Cairn Financial Advisers
LLP
Sandy Jamieson, Emma Earl +44 20 7213 0880
Peterhouse Corporate Finance
Limited
Eran Zucker / Lucy Williams + 44 20 7469 0930
Walbrook PR Ltd +44 20 7933 8787 or yolo@walbroookpr.com
Paul McManus/Sam Allen +44 7980 541 893/+44 7884 664 686
Notes to editors
YOLO Leisure and Technology plc
YOLO Leisure and Technology plc aims to focus on opportunities
in the technology, leisure and media sectors. The Company's
Investing Policy is that the Company will invest in businesses
which have some or all of the following characteristics:
-- strong management with a proven track record;
-- ready for investment without the need for material re-structuring by the Company;
-- generating positive cash flows or imminently likely to do so;
-- via an injection of new finances or specialist management,
the Company can enhance the prospects and therefore the future
value of the investment;
-- able to benefit from the directors existing network of contacts; and
-- the potential to deliver significant returns for the Company.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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November 07, 2016 02:00 ET (07:00 GMT)
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