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Update: The news has been officially announced: the two have terminated the M&A agreement. “One of [the deal] conditions was that Bolt Media finalize a definitive settlement to the outstanding copyright infringement lawsuit filed against it by UMG Recordings Inc. and settle comparable potential claims from other record labels and music publishers, subject to financial parameters acceptable to GoFish. Bolt Media was ultimately unable to reach a definitive settlement within these agreed upon parameters.” No termination or other fee will be payable in connection with the deal’s cancellation. GoFish will continue looking at other acquisitions or suitors.
Original post: This came out on DMN yesterday, and the company hasn’t officially confirmed it, but looks like they’re ready to announce something tomorrow, so we will know for sure. Anyway, GoFish, an OTC-traded online video site (OTCBB:GOFH), announced its deal in Feb to buy another video/community site Bolt for $30 million in stock. The deal followed a parallel settlement deal between Universal Music Group and Bolt.com, after UMG filed a user-gen copyright infringement lawsuit last year in October…the settlement was estimated at $10 million, the same amount GoFish raised in a private placement in May this year.
DMN reported that the deal has fallen apart, because with the deal, GoFish had agreed to assume major label and publishing liabilities related to Bolt, but then the consolidated licensing requirements proved too cumbersome. In an SEC filing on July 13 amending the earlier buyout agreement, GoFish and Bolt agreed that if the deal didn’t get completed by July 20th, then “the Buyer may terminate this Agreement.” Bolt co-founder Jay Gould posted on his blog on JUly 30th that “we still have not closed the Bolt transaction with GoFish.” Meanwhile, NewTeeVee reported that Gould and the other Bolt co-founder, Aaron Cohen, are now occupied with WikiYou, the Mayfield and First Round Capital funded startup they launched last week.
Will someone else come in and buy Bolt? We’ll find out soon.