SWEDEN - Provider Venture portfolio company files for bankrupcy

The company has been unprofitable due to the very competitive nature of the market in terms of competition from free downloading sites and tight conditions set by the major music companies. The investor does not foresee the company being profitable in the short to medium term, and according to Swedish press reports, the business has recorded a loss of SEK 30m.

Provider Venture first invested SEK 30m in the business in May 2006 for a 28% stake. At the time, the investor was attracted to the deal because of its strong position in the market, its distribution strategy and strong management team. The company was founded in 1999 by two music executives, Anders Hjelmtorp and Wilhelm Wendt. In 2005, it recorded revenues of SEK 14m.

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