The financial troubles of Proper Group (formerly Utopia Music) continued this week, with a Swiss court launching insolvency proceedings against the company over unpaid legal fees.
Proper said the bankruptcy case was caused by MME Lawa law firm owned by a music company CHF 23,000 (about. $27,000).
The music company said it was unaware that Zug-based MME Legal had launched legal proceedings against it. As a result, it missed a court hearing on Tuesday, triggering bankruptcy proceedings in the court.
In a statement released on Thursday (September 26), Proper said it had paid off MME Legal’s debt in full and planned to launch an appeal to stop the proceedings.
“We are disappointed that bankruptcy proceedings have been initiated. Unfortunately, our company was unaware that legal proceedings were being filed over a small debt and therefore we were not represented at the court hearing,” a Proper spokesperson said in a statement.
“Our debt is now resolved and we will of course appeal this decision.”
Swiss-born Proper Group has weathered a series of financial crises in the past few years after a high-profile and aggressive acquisition spree began to take its toll on the company.
In 2023, there were reports of employees at Swedish companies not being paid.
Earlier this year, a U.S. court ordered the company to pay $1.9 million To previous owners Li Yuanheng FinancialA music financing platform acquired in 2021 by Proper (then known as Utopia).
“Recent positive developments in the business put us on track to deliver positive cash flow in the near term, with a clear earnings outlook by 2025.”
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Utopia has bought companies including Quincy Jones-backed UK warehouse and fulfillment company Musimap, following an aggressive acquisition spree that has triggered financial problems. new graypublishers Sentric Music Group, Absolute Label Services and Absolute Rights Management, and Proper Music Group (a UK-based company that Utopia has since changed its name to).
But the company soon showed signs of financial trouble. Beginning in late 2022, the company initiated a series of large-scale layoffs and quickly began selling off many of its accumulated assets, including Sentric, Absolute, and ROSTR.
Complete Music Update reports that this week’s missed court date was the result of staffing shortages following company layoffs.
During the fire sale process, the company repeatedly asked shareholders for additional cash injections. Still, the company says it’s on the right track and expects to be profitable next year.
“Recent positive developments in the business put us on track to be cash flow positive in the near term and with a clear earnings outlook by 2025, we expect a favorable result,” a spokesman said on Thursday.global music business
