Guvera music streaming service escapes insolvency bid

An investor had been seeking an order to wind up the Gold Coast company, claiming a debt of almost $1.8 million.

Kwong Properties took the business, which was blocked from listing on the Australian Securities Exchange in June, to the Supreme Court of Queensland in December to recover the money.

The application was heard in Brisbane on Wednesday morning, where it was dismissed with the consent of both sides.

Lawyers for both companies refused to comment outside court.

Court papers claimed the funds had been lent in two separate tranches in May and November 2015, which the music service had failed to repay.

Co-founder Darren Herft had given only a "partial response" to a letter of demand made on September 14 last year, according to correspondence from Kwong Properties lawyer Michael O'Brien included in the application for insolvency.

"We note that, despite your admission that the debt is overdue, no firm repayment proposal has been received from you nor have you offered additional security, or priority, for the amount outstanding to our client," Mr O'Brien wrote in a September 22 legal letter.

Kwong Properties director Jack Kwong was claiming a total debt of $1,784,472.

Guvera was on track to become the biggest Australian player in a scene dominated by the likes of Spotify and Apple earlier this year with an IPO plan involving a $1.3 million valuation.

Co-founders Claes Loberg and Mr Herft raised $185 million from individual investors between 2008 and 2016.

But the contentious float was criticised heavily on the back of an $81.1 million loss on revenue of $1.2 million for the 2014/15 financial year.

In a rare move, the ASX rejected the plan in June last year, "based on material contained in Guvera's application for admission."

The company then closed its offices and removed its app in Australia, the United States, Latin America and Russia and Europe, before failing to pay severance or entitlements to staff in north and south America.