Purple Lounge to enter liquidation
Media Corp says financial and trading position of business "no longer tenable" - all staff made redundant.
Beleaguered poker and casino business Purple Lounge is to be placed into liquidation by Media Corporation, its parent company revealed today in a trading update.
All staff within the division have been made redundant with a statement from MediaCorp explaining: “It has become clear during the review that the financial and trading position of the Purple Lounge division is no longer tenable due to historic operational and financial failings within the business.
“The board announces that it…will be instructing lawyers to file the relevant documentation to put the relevant companies into liquidation. The Board will specifically request that the appointed liquidators look into the financial arrangements within the Purple Lounge group of companies and to review the position as to player funds,” the statement continues.
In April this year MediaCorp announced that Purple Lounge’s operations had been “temporarily” suspended in the light of a legal claim against one of its subsidiaries from CD Casino.com.
However it later emerged, following a statement from Maltese regulator the Lotteries and Gaming Authority (LGA), that the business had its licences terminated at its own request on 23 April. The LGA explained at the time: “Before the termination process was completed, the authority made sure that there were no pending complaints and that the licensee was compliant with the remote gaming regulations.”
Since the closure in April, MediaCorp’s proposed online joint venture with the Hippodrome Casino has been delayed while reverse takeover talks with Gaming Media Group fell through two weeks ago, with GMG explaining “It became clear that Media Corp would not be able to meet various conditions precedent to which the deal was subject.”
In February MediaCorp CEO Justin Drummond left his role to take over as executive chairman, and was replaced by former Purple Lounge MD Sara Vincent on a temporary basis. However earlier this month Vincent left the company after 12 years and Drummond did the same, with Phil Jackson being brought in as chairman and Adam Fraser Harris as interim group CEO.
Jackson and Fraser Harris were previously at newly incorporated MediaCorp company Intabet, and today’s statement from the company reveals: “Since their appointment, Adam and Phil have been conducting a strategic and financial review of the enlarged Group.”
Despite loaning “well over £1m” to Purple Lounge since acquiring it in 2009, MediaCorp said: The Board does not believe that the Group will incur any further liabilities in respect of Purple Lounge over and above the realisation of the above loan.”
A spokesperson for the Maltese Lotteries and Gaming Authority was unavailable for comment when contacted by eGR.