Quickflix fails to raise capital
Quickflix’s effort to raise almost $6 million to allow it to compete with the likes of Netflix in 2015 has fallen dramatically short of target.
The struggling online streaming service today said a renounceable rights offer had raised just over $650,000, or just 11 per cent of the hoped-for $5.7 million.
It says it will now attempt to find other investors to make up the shortfall.
Quickflix in November said the capital raising was to provide funds so it could better compete with rival streaming services, including global giant Netflix, which is due to arrive in Australia in March.
Other competitors include Foxtel’s Presto and Stan, a joint venture between Nine and Fairfax, which is also due to launch in early 2015.
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But the company also said some of the funds would be put toward “working capital” and, in its offer document to shareholders, admitted a failure to raise sufficient funds could affect its operations.
“There is no guarantee that the company will raise sufficient funds to achieve the company’s objectives and there may be restrictions on the company’s financing and operating activities,” the document said.
“Further, the company may be required to reduce the scope of its operations or anticipated expansion and it may affect the company’s ability to continue as a going concern.”
The proposed capital raising would see the number of Quickflix shares on issue more than double to around 3.4 billion.
Quickflix shares finished Wednesday at 0.3 cents.
