(Alliance News) - Shares in 7digital Group PLC spiked Thursday after the company underwent a board reshuffle as it finalised its fundraising efforts.
7digital was 39% higher in mid-morning trade at 0.25 pence each.
7digital Chief Executive John Aalbers and Chief Financial Officer Julia Hubbard are stepping down from their roles, saving the company GBP1 million annually.
The will be replaced by current Chief Operating Officer Paul Langworthy and current eMusic CFO Michael Juskiewicz, respectively.
Both Aalbers and Hubbard will stay with 7digital until September in order to assist with the handover, however, both have stepped down with immediate effect.
7digital said Langworthy has been involved in "devising the company's revised business strategy".
Aalbers said: "When I joined 7digital in April this year the team and I were immediately challenged with the financial difficulties faced by the company."
"We urgently set about looking for ways to refinance the business through a combination of asset sales and fundraising. Three and a half months on, we have largely completed the rescue by securing a new, strategic majority investor, which has stated that it is prepared to invest further funds. The final phase of the fundraising is in progress and we expect an additional GBP4.5 million to be raised in the coming weeks."
Aalbers said these funds will provide the company the neccessary resources to implement its revised strategy and put the company "on a solid path towards both growth and profitability".
"Nevertheless, the Company needs to further consolidate and control our operating costs to support the new model," he added.
Earlier this week, 7digital appointed Tamir Koch as non-executive chair.
Koch is currently president of eMusic, an online music and audiobook store focusing on discovery and sales of independent music and artists.
7digital said Koch along with his partners is co-ordinating GBP6.5 million in funding for the company. 7digital didn't specify the type of funding planned, whether debt or equity. Koch and his partners have already invested GBP2 million by purchasing existing loan notes and subscribing for new shares in 7digital.