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Liquid Audio awaits vote results

Evan Hansen und Dietmar Mueller Evan Hansen und Dietmar Mueller CNet

Published: 27 Sep 2002 12:13 BST

Liquid Audio said it plans to announce next week the results of a closely watched shareholder vote on Thursday that could decide the future of the online music company.

Key issues on the table at Thursday's annual meeting included management's proposal to accept a buyout offer from Alliance Entertainment, a privately held retail music fulfillment company. That plan is opposed by a group of dissident shareholders seeking to oust the current board of directors, shut the company down and return its remaining cash reserves to investors.

A Liquid Audio representative said the company does not plan to release a preliminary vote count. An announcement of the final tally is expected 4 October.

Shareholders opposing the merger include Steel Partners, which has made its own bids to buy Liquid Audio, and BCG Strategic Investors co-founder James Mitarotonda.

Liquid Audio has struggled for years to make money from its secure platform for delivering music downloads over the Internet, a plan complicated by the availability of free music over peer-to-peer and file-swapping services.

The company reported revenue of $151,000 (£97,000) for the second quarter of the year and a loss of $5.6m. Its cash and cash equivalents at 30 June, 2002 were $81m, compared with $86.4m at 31 March and $91.6m at 31 December, 2001.

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