Copyright Law

GGF Stock Halted Until it Shows Pirate Bay Cash

By soulxtc

Increasing reports that Global Gaming Factory doesn’t have nearly the amount of money available it’s promised to succeed in its acquisition of the Pirate Bay.

Things are looking murky for the Pirate Bay deal with reports on several fronts that Global Gaming Factory’s acquisition of the Swedish BitTorrent tracker site is in trouble, and it appears it all has to do with financing.

It first began back in July when Wayne Rosso, the former CEO of Grokster who had been brought in to negotiate deals with the entertainment industry, left GGF over “very strong doubts that the funding is in place.”

GGF CEO Hans Pandeya said at the time that there are “plenty of investors interested in this,? that in fact a group was already “prepared to inject 30 million kronor ($4.05 million USD) relating to the cash portion of the purchase price of The Pirate Bay,” but even there he’s still about $3 million USD short of the $7.8 million he agreed to pay for it.

Then yesterday Peerialism CEO Johan Ljungbergn told CNet that it hasn’t seen a dime of the money GGF promised it. GGF was to acquire Peerialism, a Swedish software company that has developed next generation file-sharing technology, for $6.5 million USD in cash and $6.5 million USD in stock so that it could use its new data distribution technology in order to strengthen its “strategic position in the international digital distribution market.”

“From the beginning we asked to see a business plan, the names of his investors, or to see some (technical specifications),” said Ljungbergn. “We still haven’t heard a thing…the question marks are growing bigger by the day. We’re not quite comfortable with the situation. We had really high hopes and ambitions for our technology but I’m not sure if this is the right home for it.”

The Local even reports that former GGF board member Johan Sellström has reported Pandeya to Swedish cops for more than 6 million kronor ($853,752 USD) in unpaid debts.

Pandeya is also alleged to owe some 780,000 kronor (110,987 USD) in back taxes.

All of this culminated today when GGF announced that trading of its shares had been halted by AktieTorget, the stock market where it’s traded, until it can “show that the whole funding is at hand in accordance with what the company reported.”

AktieTorget says that GGF told it that “more than 60 million kronor has been offered by investors” finance its purchase of the Pirate Bay to “establish a system of legal downloading.”

“Once this information is confirmed the suspension can be lifted,” it adds.

Pandeya is expected to present GGF’s full plan for the Pirate Bay to shareholders next week, August 27th, at which time it’s expected to finalize the deal.

With financing become such an increasing issue it may prove difficult.

In short, it may be far tougher to compete with other BitTorrent tracker sites – where content is FREE – than the Pirate Bay realizes, and so perhaps some potential investors are starting to realize this.

I guess either way we’ll see for sure next Thursday.

Stay tuned.

jared@zeroapid.com

Full post as published by ZeroPaid on August 21, 2009 (boomark / email).