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From its origins in the music credits business with Jaxsta, Vinyl Group (ASX: VNL) continues its diversification as a multi-faceted media business after reaching a deal to buy the assets of Mediaweek for $1 million, adding its nascent publishing portfolio that has included The Brag Media since the start of 2024.
Vinyl, which also owns creator social media network Vampr and fan e-commerce store Vinyl.com, has executed a head of agreement to buy Mediaweek from Chattr.
Founded in 1990, Mediaweek is a leading a trade publication in Australia with a monthly average readership of 300,000 unique visitors, and will add to such Vinyl Group-owned business-to-business titles as The Music Network and Variety Australia.
The business is also known for its Mediaweek100 event and the Next of the Best Awards.
The deal will comprise $500,000 in cash and the remainder in shares, valued at a 15-day volume weighted average price (VWAP) for Vinyl Group shares on the ASX for the period that immediately follows completion of the deal, which is anticipated to be no later than 30 September.
Upon completion, several Mediaweek employees will join Vinyl Group as part of the deal while its current owner Trent Thomas will remain with Chattr Pty Ltd and the Chattr website, the assets of which are not included in this acquisition.
Mediaweek's unaudited revenues for FY24 amounted to $2.2 million, with a proforma profit of at least $350,000 as Mediaweek shares costs across Thomas’ Chattr platform costs.
Vinyl Group expects to realise further and immediate profits through its integration efforts and synergies from existing capabilities within the company.
"Mediaweek will join Vinyl Group with a mission to accelerate our trade media and events business in Australia and improve margins across these pillars," says Vinyl Group CEO, who founded Vampr which was acquired by the group in mid-2023.
"This acquisition follows a review of our media arm earlier in the year, which identified several opportunities to enhance the efficiency and reach of these operations.
"Further synergies are expected to be unlocked and we look forward to announcing a managing editor of Mediaweek following completion. This strategic asset purchase demonstrates our commitment to growing our global music and media tech portfolio."
Vinyl Group shares have been on a rollercoaster ride having lost 45 per cent of their value since achieving four-year highs in May, but at 9.8 cents per share (cps) are still up 38 per cent on levels at the start of 2024.
The company achieved a record quarter in the three months to the end of June with cash receipts up 52 per cent at $2.56 million, and in that same period Vinyl Group raised $5.4 million, with backing from Washington H. Soul Pattinson (ASX: SOL) chairman Robert Millner, WiseTech (ASX: WTC) founder Richard White, director Ken Gaunt and Josh Simons.
Aussie-founded US music tech giant Songtradr is also a substantial shareholder in the company.
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