Brag book: WiseTech’s Richard White adds Rolling Stone to his rocking portfolio
Vinyl Group is getting an upbeat response from investors after inking a $10 million deal to bring Rolling Stone and Variety magazines into its stable.
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The world’s largest dedicated database of official music credits, Vinyl Group (ASX:VNL), is getting an upbeat response from investors after inking a $10 million deal to bring Rolling Stone magazine into its stable.
At 1.30pm Thursday (AEDT), the stock formerly known as Jaxsta was up nearly 18 per cent for the day on news it would acquire The Brag Media, publisher of the iconic mag in Australia and New Zealand.
The deal is being funded by WiseTech Global (ASX:WTC) founder, CEO and keen muso Richard White.
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After becoming a substantial shareholder of VNL in June, White has injected a further $11 million of funding by way of a placement and debt facility through his investment fund RealWise Group Holdings.
The Brag Media publishes owns outlets TheBrag.com, The Music Network and Tone Deaf, and Penske Media Corporation titles Rolling Stone and Variety in Australia and New Zealand.
The company also exclusively represents local digital audiences for more than a dozen other titles including HypeBeast, Billboard, The Hollywood Reporter, Music Feeds, ComingSoon, Rotten Tomatoes, Game Revolution and IndieWire.
In an announcement, VNL said the Brag Media network of premium brands reached about 10 million users a month in the region, with more than 40 million monthly page views, cementing its position as Australia’s largest youth publisher.
VNL will pay $8 million in cash upfront to acquire 100 per cent of Brag Media and its subsidiaries (Brag Group), with a further $2 million payable in cash or stock payable based on financial performance.
The company says the deferred payment will be based on a sliding scale after achieving both a minimum revenue of $12 million and a minimum EBITDA of $2 million up to a maximum of $15.5 million in revenue and EBITDA of $2.8 million.
Unaudited FY23 results highlight The Brag Media generated $8.39 million in revenue including $334,824 in net profit.
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The Brag Media’s average revenue has grown 125 per cent over the past two financial years.
As part of the deal, The Brag Media CEO Luke Girgis will join the VNL leadership.
His title will be publisher and MD of The Brag Media, which VNL says “includes a minimum two-year term and a requirement for full-time dedication to The Brag Media and Vinyl Group businesses post-sale”.
White rocks in
Billionaire richlister White, who made his fortune building his global logistics tech platform WTC and has been a serial start-up investor, became a substantial shareholder in VNL mid-year with a 9.64 per cent holding.
In his early days, the now 68-year-old worked as roadie, repairing guitars on tour for bands including AC/DC and The Angels.
It’s been a big year for VNL, which has launched VINYL.com, a global music products marketplace, featuring a deep catalogue of over 50,000 vinyl records across all genres.
In June VNL completed its acquisition the world’s largest social media network for musicians Vampr, which was co-founded in 2015 by Hunters & Collectors guitarist Baz Palmer and Josh Simons of indie rock band Buchanan.
When the deal was finalised, Simons went on to replace former Vampr CEO Beth Appleton.
The former CMO had been promoted to the top job in 2022 following the resignation of founder Jacqui Louez Schoorl.
“I have watched closely as Josh has built Vinyl Group’s revenue and made substantial business gains since taking my initial investment,” White said in Thursday’s announcement.
“I’ve also noted that Luke and his dedicated team at The Brag Media have rapidly grown Brag into one of Australia’s most influential media and creative businesses.
“There’s no doubt that iconic brands like Rolling Stone and Variety make sense and add value to VNL.”
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Could White be building a rock empire?
Red Leaf Securities CEO John Athanasiou told Stockhead that White’s latest investment in VNL suggests he is intent on building something bigger.
“This is definitely a deal to brag about with Richard White investing in Vinyl Group again this time for the purpose of buying The Brag Media, which has numerous iconic music labels such as Rolling Stone in Australia and New Zealand,” Athanasiou says.
“This shows Richard believes in the management group story and CEO Josh Simons.”
“Having The Brag Media as part of Vinyl will supercharge its growth.”
Simons says VNL’s suite of products work together to empower participants of the music ecosystem and reach all corners of the creator economy and is looking forward to working with the iconic The Brag Group mastheads.
“We’ve identified several impactful synergies between the two businesses that will deliver immediate cost efficiencies and revenue, including streamlining Vampr’s in-app ads business and leveraging The Brag Media’s impressive audience reach to bolster Jaxsta, Vinyl.com and Vampr in the market,” he says.
Disclaimer: Red Leaf Securities has an interest in Vinyl Group.
This content first appeared on stockhead.com.au
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Originally published as Brag book: WiseTech’s Richard White adds Rolling Stone to his rocking portfolio
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