(Reuters) -Consultancy and marketing group Next 15 said on Thursday that it will permanently cease operations at its U.S.-based venture-building firm Mach49, which has been under scrutiny for “serious misconduct”.
Next 15, which acquired Mach49 in September 2020, said in June it had uncovered “potential serious misconduct” during a review of earnout payments, leading to the dismissal of three senior executives at Mach49 and involvement of law enforcement.
The company said it has entered arbitration with former Mach49 members over remaining earnout payments, and reaffirmed its decision to halt further payouts and filed counter claims for previous payments.
The British company, whose brands include elvis, Outcast and Shopper Media Group, has also been in discussions for a potential sale of some of its brands, as part of its ongoing efforts to streamline operations.
The group, which cut its profit forecast in June, said it continues to expects adjusted operating profit for the year ending January 2026 to be in-line with market expectations of 67.5 million pounds ($91.2 million), according to a company consensus.
Mach49 is expected to wind down operations before the end of fiscal year 2026, it said.
($1 = 0.7402 pounds)
(Reporting by Raechel Thankam Job in Bengaluru; Editing by Sherry Jacob-Phillips and Sonia Cheema)
