In a $5 million deal, Vinyl Group, an ASX-listed music company, will acquire Concrete Playground, a digital city guide.
The deal consists of $3.5 million in cash and $1.5 million in Vinyl Group stock.
An immediate financial boost is expected. In 2024, Concrete Playground is expected to generate at least $1.5 million in EBITDA and more than $4 million in unaudited revenue.
Founded in 2009, Concrete Playground provides city guides and curates local events, experiences, and trends in cities such as Sydney, Melbourne, Brisbane, Auckland, and Wellington. Vinyl Group aims to increase operational efficiency, diversify its commercial footprint, and broaden its client base with Concrete Playground.
Vinyl Group CEO Josh Simons said the acquisition will elevate their capabilities and fast-track sustained profitability. Simons said: “We are looking forward to working with Rich and the Concrete Playground team to complete this acquisition in early 2025. They’ve built a trusted platform that audiences genuinely love, and their approach to storytelling will be a natural fit with our broader media strategy.
"Operationally, this acquisition will be significant for Vinyl Group - it would not only elevate our capabilities but also fast-track our path to sustained profitability, allowing us to deliver even greater value to our shareholders and partners.”
As part of the agreement, Vinyl Group will acquire 100% of Concrete Playground's issued capital. The $1.5 million in shares will be issued as 12,676,413 ordinary shares at $0.11833 per share. This is subject to a 12-month escrow period. The deal is expected to be finalised by February 28, 2025.
Concrete Playground's Founder and CEO, Rich Fogarty, will exit the business upon completion of the acquisition. Fogarty praised Vinyl Group's vision and resources for elevating the platform.
Fogarty said: "I’m immensely proud of everything Concrete Playground has achieved over the past 15 years. This milestone reflects the talent, creativity and dedication of our team, along with the trust of our readers and partners. As the business transitions to new ownership under Vinyl Group, I’m confident their vision and resources will elevate Concrete Playground to new heights, inspiring even more people to discover the very best their cities have to offer."
Vinyl Group's portfolio includes Vampr, Jaxsta, Serenade, and Vinyl.com, an e-commerce arm. With Concrete Playground, Vinyl Group adds to its media divisions, including The Brag Media and Mediaweek. Further commercial expansion is also expected.
As at 5:23 pm (AEDT), Thursday 12 December, Vinyl Group Ltd's (ASX: VNL) share price was 11 cents. The company's market capitalisation is approximately $128.68 million.