Those of you waiting for the tie-up of second-screen apps GetGlue and Viggle — Giggle? — to close will have to wait just a little bit longer. The merger of the companies, which was announced in November, has yet to close thanks to expected additional financing for Viggle which hasn’t come through.
To recap: Viggle announced plans to acquire GetGlue for $25 million in cash and 48.3 million shares of stock. But Viggle didn’t actually have the cash on hand to get the deal done, and so the whole thing was contingent on $60 million in new financing from an unnamed strategic partner. Viggle expected that financing to close within 30 days, and as a result its merger had a deadline of December 19 for its close.
Well, that date has come and gone — and so, the two companies are “discussing an extension of such date and other potential modifications to the Merger Agreement,” according to an SEC filing. Representatives from both Viggle and GetGlue have confirmed that they are working on an extension. And Viggle still expects to raise its $60 million from a strategic investor, but as a source close to the situation told TechCrunch, “it isn’t done until it’s done.”
In the meantime, Viggle CEO Robert Sillerman continues to support the venture with his own cash, with continued extension of his loan agreement with the company. In mid-December, Sillerman extended his existing loan agreement with Viggle from $12.5 million to $15 million, fronting an additional $2.5 million to the venture. That loan was presumably made to keep the lights on while the company waits for new money to come in.
In the meantime, Viggle seems to be burning cash at an alarming rate. Viggle had just $1.7 million in revenues through November, while spending $32.6 million on operations. While it’s making some cuts, it still expects capital requirements of $22 million through 2013. That new funding, when it comes through, should help keep it afloat. But Viggle will probably need to do more belt tightening if it expects to make a long-lasting business out of social TV. We’ll keep you posted on how that’s going.