21/12/2023 - Vinyl Group (ASX: VNL), Australia's only ASX-listed music company, has announced a pivotal move in the media and music industry. The company has entered a binding agreement to acquire The Brag Media, a significant player in youth publishing. Here are five essential points from the deal:
Acquisition Details: Vinyl Group will acquire The Brag Media for $8 million in cash, with an additional $2 million in cash or stock at Vinyl Group's discretion. This acquisition includes the entire network of The Brag Media, encompassing renowned titles like Rolling Stone and Variety in Australia and New Zealand.
Financial Aspects: The Brag Media has demonstrated strong financial performance, with $8.39 million in revenues and $334,824 in net profit for the Financial Year 2023. The deal stipulates revenue and EBIT targets for The Brag Group for Calendar Year 2024, with deferred compensation based on achieving these goals.
Funding Strategy: The acquisition is backed by a significant investment from WiseTech Global Founder and CEO Richard White. He will inject $11 million through a new placement and debt facility, emphasizing his confidence in Vinyl Group's growth trajectory and the strategic value of this acquisition.
Management and Operational Integration: As part of the acquisition, The Brag Media CEO Luke Girgis will join Vinyl Group under a full-time employment agreement. This move ensures the seamless integration of The Brag Media into Vinyl Group's portfolio and leverages Girgis's expertise in driving the media outlet's success.
Strategic Synergies and Vision: Vinyl Group envisions leveraging the acquisition to enhance its footprint in the music industry. The deal is seen as a strategic fit, providing cost efficiencies and revenue growth opportunities by integrating The Brag Media's audience reach and media presence with Vinyl Group's existing platforms like Jaxsta, Vampr, and Vinyl.com.
This note was based on facts from the company update dated 21/12/2023.
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