SYDNEY: Photon Group may have to push a planned $115 million capital raising back until next week while its efforts to renegotiate earn-out deals with its agencies drag on.
It is understood the beleaguered marketing services company is still locked in talks with a small number of agencies. Discussions with the majority of the group’s 50 businesses are believed to have been concluded.
The delay comes amid rumours that some of the group's most prized assets have been approached by rival marketing services groups, while Photon's new chief executive, Jeremy Philips, battles his way through the group's financial problems.
Philips is trying to renegotiate the terms previously agreed for the purchase of various companies in the group, including Naked. He is also trying to renegotiate the terms of its bank facilities, the success of which will be dependent on – among other factors – the raising of additional share capital.
Philips has offered agency executives an upfront cash component worth about 35 cents in the dollar. The executives have also been offered Photon stock and deferred cash payments.
Sources close to Photon and some of its agencies said they agreed in principle to new earn-out agreements and many expect a new deal to be concluded soon.
Photon's shares have been suspended for more than six weeks, while Philips restructures the group.
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