LONDON: Live Company Group has subscribed for a non-controlling stake in Start Art Global Ltd, an online art and digital art sales and news platform, to be funded out of a proposed placing, a news release said.
Live Company has agreed, subject to the passing of the Resolutions at the forthcoming General Meeting, to subscribe for an initial 16.3% of the issued share capital of Start Art at a cost of £1.0 million with the option to increase its shareholding in the Company to 20% within six months.
The Company has also received an undertaking that should Start Art seek additional funds from a third party within 6 months Start Art shall take such steps as may reasonably be required to ensure that the Company’s shareholding shall not be diluted below 12%.
Additionally, the Company will be party to the Shareholder Agreement which provides standard protections such as pre-emption and “drag and tag” on sale.
David Ciclitira, Chairman of LVCG said: “We have spent the past year of lockdown both restructuring our existing business, launching a new sports and entertainment division and exploring opportunities in complementary businesses less affected by Covid. Today marks an acquisition in a very exciting space which encompasses both celebrity art and the world of NFTs.
In addition, the last few months have seen a resurgence of opportunities in our existing business which has meant that we will look to recommence our Bricklive build programme to keep up with demand in the UK, USA and China while of course maintaining our strategy of only building when this demand dictates.
The raising of additional working capital and introduction of institutional clients into the register will leave the Company in a stronger position. I remain absolutely committed to the Group and excited for the future of our core BrickLive business, recently established sports and entertainment division and this new on-line art investment. “
Start Art is a UK private company limited by shares that includes a curated online art-sales platform (due to launch at the end of June, 2021) and an art news service due to before the end of 2021.
The concept of Start Art was launched by David Ciclitira in 2020 as part of the Global Eye Programme and was given further impetus by the financing, strategic vision and knowledge of the Asian art market by Ranjit Murugason, the deputy chairman of Start Art. Start Art is managed by managing director, Nicola Gross, and supported by Daniel Sumner, chief technology Officer.
Prior to the Acquisition David Cicilitira (Chairman of LVCG) owns 75% of the shares in Start Art with the remaining 25% of the shares held by Ranjit Murugason (a non-executive director of LVCG). 12% of the shares is due to be allocated post Transaction from shares held by David Ciclitira to key management personnel including Daniel Sumner, Nicola Gross and members of the Curator team.
Start Art currently has fifty artists signed up and will soft launch in June, 2021 with “go live” date and revenue generation commencing in from Q3, 2021. It is intended to have 100 artists signed up by the “go live” date.
Start Art will contract with three K-Pop artists with significant social media and fan following to sell their art and limited edition prints on the “go live” date. There will also be a line of merchandise featuring the K-Pop artists’ works. These will be available for sale on the platform from date of launch.
The injection of cash by the Company into Start Art provides the capital required for the development of the existing platform, its expansion and to allow for client relationship management (CRM) integration, live and pre-recorded TV and News, the addition of virtual reality features, a crypto payment gateway (to allow payment of products using virtual currencies) and NFT capabilities as well as other technology-based expansions.
Start Art also intends to help artists mint their own non fungible tokens (“NFTs”, a non-fungible token is a unique unit of data stored on a blockchain) working with a third-party system – OpenSea. Once Start Art has completed the minting process, the NFT will be available to purchase on the platform. This service is anticipated to be available from Q3 of 2021.
Start Art, which was incorporated in early 2021, (although the concept was developed through 2020) is at the pre-revenue stage and has yet to prepare any accounts. For the purposes of the Subscription, it is warranting as at 31 March 2021 net assets of £1,464,161 including cash of £260,736.