You would have thought that KIT digital would have kept a low profile for a few months. The controversial company announced it was about to emerge from bankruptcy and had a new brand that it planned to shout about during IBC.
Such a scenario was more than optimistic, yet still surprising, even when the company’s history is taken into account. Even before the paint is dry on the Piksel marque, KIT digital is making waves.
utd. by content, was spun off from KIT Digital in June 2012 at the height of its troubles. The business was sold for $18.8 million, comprised of an initial cash payment of $1.0 million and a $17.8 million multi-year earn-out payment obligation based on revenue achieved.
KIT is now alleging breach of contract and says it is now seeking avoidance and recovery of a fraudulent transfer – effectively looking to restore the business to the KIT portfolio.
It is not that contract disputes between companies are uncommon – and we will leave KIT and utd to sort out this one in the courts – patent disputes are commonplace as are licensing and carriage fee disputes.
What is the surprise is KIT’s insistence on doing its washing in public. At the heart of this latest dispute is Peter Heiland, the activist investor, who is the company’s acting CEO.
But the DNA here goes back to KIT’s founder Isaza Tuzman, who in the middle of the company’s shopping spree – a series of acquisitions made by Kit have included UK-based Megahertz Broadcast Systems, a $2.7m deal concluded at IBC 2010, and in April 2011 cloud based video provider ioko365 for US$79.4 million – attacked a Wall Street Journal article on the company’s growth prospects.
I remember the statement well, it ran to several pages, and alerted me to a WSJ article I would have otherwise missed.
We also had the withdrawal from NASDAQ and the dismissal of the company’s auditors.
Piksel is clearly not going to be one of those companies that gets on with its great technology.