2M Invest has written off DKK20 million on its portfolio company Danish marketing group, Dial Nxt Group (DNG). DNG has filed a petition for bankruptcy to the Stockholm Stock Exchange and will undergo liquidation.
2M Invest originally invested DKK13.7 million in the company last summer in order to turn around the company. The firm also provided guarantees for DNG amounting to DKK6 million. The total commitment will be written off in 2M Invest’s accounts for 2001, which are expected to show a loss of DKK120 million.
Although part of DNG’s operations showed a profit in the months of September and November, the growth expected in the fourth quarter did not occur and as a result the debt could not be settled as expected. 2M therefore decided it would not contribute to a further round of funding.
In an effort to strengthen resources, at the end of last year 2M Invest entered into a strategic alliance with Growth.dk combining their skills in the Danish market to take advantage of both early and later stage opportunities in private equity.