Former Barclays boss Bob Diamond is trying to tackle TikTok as chair of a social media start-up that claims to be price greater than $3bn, regardless of income of solely $36mn and fewer than $1mn in money available final yr.
The new course for the financier comes after video platform Triller agreed an all-share takeover by AGBA, a small US-listed Hong Kong-based monetary providers platform with a controversial previous. Diamond, who has chaired AGBA since September, will serve in the identical capability on the mixed entity.
Shares in AGBA have leapt greater than 400 per cent because the deal was introduced on April 18. In a press launch and presentation discussing the deal, AGBA mentioned Los Angeles-based Triller had been independently valued at $3.2bn and that the mixed group can be price $4bn “on a pro forma basis”. Triller shareholders will maintain 80 per cent of the shares.
But based mostly on AGBA’s share value of 40 cents earlier than the deal information broke, the 407mn shares it’ll concern suggest Triller agreed to be acquired for $163mn. The Los Angeles-based group reported revenues of simply $36mn within the 9 months to September and losses of $131mn. AGBA reported a web lack of $49mn on revenues of $54mn final yr and money available of $1.8mn on the finish of December.
The Triller foray is a departure for Diamond, who as soon as commanded a financial institution with a trillion-dollar stability sheet. He resigned from Barclays in 2012 after the Libor rate-rigging scandal and has since saved a comparatively low profile.
Triller is a controversial — and minuscule — participant within the music trade. The start-up in 2019 introduced investments from a variety of well-known artists together with Snoop Dogg, The Weeknd, Lil Wayne and Kendrick Lamar. Then chief government Mike Lu made the daring declare that this “marks perhaps the most significant shift in music since the creation of streaming”.
The firm has tried to capitalise on the backlash towards TikTok over its Chinese possession, with Lu’s substitute Mahi de Silva in 2022 calling for each American to delete TikTok. Triller is now led by Bobby Sarnevesht.
But Triller was accused of inflating its customers numbers and has been sued by the most important music teams on the planet — Universal and Sony — for failing to pay them royalties owed. Triller owed music corporations $24mn on the finish of September however had solely $967,000 of money available, in keeping with a January regulatory submitting, by which it reported it had raised $420mn.
Since Diamond’s departure from Barclays he has principally caught to dealing in monetary providers. Earlier this yr he merged the UK mid-market dealer, Panmure Gordon, with a rival. Panmure is held by Atlas Merchant Capital, his funding automobile.
Diamond declined to touch upon the merger of AGBA with Triller.
Atlas has been an adviser to AGBA, for $83,000 a month — the identical quantity Diamond is receiving as chair of the monetary providers platform.
Wing-Fai-Ng, group president of lossmaking AGBA who might be chief government of the mixed group, advised the Financial Times he had recognized Diamond for greater than a decade and regarded him “like family”.
The Triller deal was introduced days earlier than President Joe Biden signed into legislation an initiative that can ban dominant video app TikTok from US app shops until its Chinese mother or father divests the enterprise.
AGBA, initially a particular goal acquisition firm arrange by a Hong Kong enterprise, and which is domiciled within the British Virgin Islands, has agreed to redomicile within the US as a situation of the merger.
“We believe there is a massive opportunity in social media, in video sharing coming out in the United States in the next year or so and we believe that Triller is by far and away the past positioned company to take advantage of that,” Ng, a former funding banker, advised the FT.
Triller was billed as “a pioneering force in the intersection of technology, entertainment and commerce leveraging advanced AI” in an AGBA investor presentation explaining the deal that mentioned the platform had greater than 450mn client accounts.
Triller declined to debate its present buyers.
AGBA’s majority proprietor is managed by Taiwanese businessman Richard Tsai whose household based the Fubon Financial empire. Tsai additionally holds a stake in Triller, in keeping with regulatory filings.
AGBA got here into its present type after it merged with troubled Convoy Global following the Hong Kong funding adviser’s pressured delisting from the town’s inventory alternate after failing to provide well timed accounts.
Its troubles stemmed from its position on the centre of a 2017 scandal within the metropolis dubbed the “Enigma network” which highlighted an internet of tightly-controlled cross-shareholdings in publicly listed corporations within the territory. Several former Convoy executives have been jailed for fraud in 2021.
The new firm started buying and selling within the US in November 2022.