Mars Growth Capital Seeks to Seize OpenWeb Assets Over $20 Million Debt

Mars Growth Capital, part of the Liquidity group, is demanding the seizure of assets from the tech company OpenWeb to recover a debt of approximately $20 million. Mars alleges that OpenWeb failed to meet financial projections for months, its anticipated sale as a debt repayment source changed significantly, and crucial information about the termination of its contract with Microsoft was withheld.

This move follows a court ruling the previous day that declared OpenWeb insolvent and recommended the appointment of a temporary trustee. The Tel Aviv District Court received Mars's request to enforce security interests and appoint a receiver for OpenWeb's assets in Israel, including bank accounts and intellectual property. Mars also filed an objection to the temporary measures OpenWeb had sought within its insolvency proceedings.

Mars claims OpenWeb's debt to them stands at $20.01 million as of September 30, with additional interest accruing. The company disputes OpenWeb's narrative that the creditor's actions led to its financial decline, asserting instead that it showed considerable patience as OpenWeb missed projections and its financial data worsened. Mars provided OpenWeb with a credit line of up to $30 million, of which $24.4 million was drawn, expressing concerns about OpenWeb's financial health even during the second draw in June.

Further complicating matters, Mars highlights a drastic discrepancy between OpenWeb's initial business projections and its actual performance. Original forecasts for 2025 revenues were $193.7 million, but actual revenues were only about $121.6 million. A revised business plan in September significantly cut revenue forecasts for 2026 from $256.9 million to $109.5 million, and projected a negative EBITDA for 2026, contrary to earlier expectations of profitability.

A key point of contention is the failed sale of OpenWeb. Mars was informed that a sale valued at $100 million was in the works, but the deal's structure and repayment terms were unclear. In early September, OpenWeb announced the deal had taken a different direction, focusing on a partial asset sale instead of a full company sale, which Mars argues constitutes a material misrepresentation given the debt repayment expectations.

Mars also revealed it only learned about the termination of OpenWeb's significant contract with Microsoft, due to suspected invalid traffic, through OpenWeb's court filing. This termination, which occurred in February, was not disclosed to Mars in real-time or for months afterward, constituting a breach of reporting obligations, according to Mars. The company also disputes OpenWeb's claims that Mars's freezing of certain overseas bank accounts crippled its operations, stating that substantial funds remained accessible.