ASX-listed voice data company Dubber is borrowing $5 million in bridging finance from existing investor Alex Waislitz to solve a cash flow crisis after more than $26 million of the company’s funds went missing.
Tiga Trading, a company associated with the Melbourne billionaire’s Thorney Investment Group, is stumping up the cash as a loan secured against the business, with $1.5 million available immediately.
In February, Thorney increased its stake in Dubber to 14.37%.
While Dubber’s (ASX: DUB) share price has seen the company’s market cap fall more than 90% in just 30 months, the wheels fell off 3 weeks ago when its shares were suspended and the CEO was stood down and the company revealed that $30 million, supposedly in a term deposit, “may have been applied for other purposes”.
While $3.4 million was recovered with $26.6 million still missing. Dubber said on Friday, two weeks after revealing the problem, that it is “evaluating avenues for possible recovery of these funds” and ASIC has launched an investigation into the matter.
The issue came to light as part of the audit review for its half-year accounts to December 2023. The half-year results have yet to be released and Dubber shares remain suspended, having last traded at $0.22 cents.
The company is also looking to raise additional capital at a deep discount on its current share price, adding that in the meantime alternatives to the Thorney Investment Group proposal “were neither practicable nor feasible in light of the urgency and timing constraints for funding” and loan was “entered into on arm’s length terms and is fair and reasonable”.
Alex Waislitz said they “were shocked” by what had happened.
“Notwithstanding, Thorney continues to believe Dubber has sound prospects having built a substantial global client base that includes many Tier 1 communications service providers,” he said.
“Accordingly, we are supporting the company’s interim funding requirements through this bridging loan facility.”
Dubber chair Neil Wilson said the business appreciated the support from Thorney Investment Group to give them working capital ahead a proposed equity capital raising.
The call recording analysis company’s services continue to be provided to its global customer base and the business is now looking at the terms and structure of its equity raise to replenish its balance sheet.
Last July Dubber raised $10.25 million at $0.14 cents a share.
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