Sydney-based independent software vendor (ISV) Semantic Software Asia Pacific is set for closure as the Australian Securities and Investments Commission (ASIC) green lights its winding up.
Liquidators are set to be appointed to the artificial intelligence (AI) specialist after the New South Wales Supreme Court ordered that it be wound up on “just and equitable grounds”.
The ruling follows earlier court orders made on 28 June 2021 that preserved Semantic’s assets and restrained Semantic director Duncan Mount and former director Mark Bradley from receiving or soliciting funds from investors and from advertising, promoting, or marketing fundraising for the company.
According to an ASIC update, the court earlier noted that material provided to Semantic shareholders failed to disclose that Semantic did not have sufficient assets available to meet share buy-back guarantees and that investor funds had been transferred from Semantic’s bank account to Mount’s personal account.
Prior to this, on 24 June, ASIC filed an application to the NSW Supreme Court seeking orders, included the appointment of provisional liquidators, PricewaterhouseCoopers.
This followed accusations from ASIC that Semantic was unlawfully dealing with investor funds; not being properly managed; was insolvent or likely to become insolvent; had issued shares without compliance with the Corporations Act; had issued shares to investors with a share buy-back guarantee in circumstances where the company did not have sufficient funds to meet that obligation.
In addition, ASIC claimed the company had entered related party transactions with former Semantic director Mark Bradley, who has been bankrupt, ASIC said, without shareholder approval.
Semantic Software Asia Pacific came under fire from shareholders over the continued absence of promised returns in a case heard NSW Supreme Court during February 2017.
During this, two investors in the company, the trustees for the Ebbsfleet Superannuation Fund and the McGee Superannuation Fund, alleged that Semantic Software had breached the terms of an agreement promising to triple share value within two years of issue.