Vinyl Group (ASX:VNL) has announced its acquisition of Funkified Entertainment for a total consideration of $2.5 million.
The acquisition involves $1.8 million in cash and $200,000 in shares, with an additional $500,000 in deferred performance shares.
Funkified Entertainment, founded in 2009, specialises in end-to-end events and brand activations.
It has operated as an in-house events arm for The Brag Media since 2021 and functions as a brand activation agency for major advertising and creative houses across Australia.
The acquisition brings Vinyl Group's events functions in-house, aimed at improving margins and accelerating growth.
On completion, Funkified Founder & CEO Gus Stephenson will join Vinyl Group in full-time employment to lead Funkified.
He will be incentivised with five million options vesting in four equal tranches over his subsequent years of employment.
Funkified’s unaudited revenues for FY24 amounted to $4.03 million with an EBITDA of $430,000.
Vinyl Group CEO, Josh Simons, noted, "The acquisition of Funkified completes our acquisition strategy aimed at fully realising the opportunities identified in The Brag Media business, while improving group company margins, revenue and driving growth."
"Additionally, it accelerates our path to profitability. We look forward to welcoming the Funkified team and working closely together on opportunities to grow," Simons added.
Funkified Founder & CEO, Gus Stephenson, expressed excitement, "Following several years of working closely with the incredible team at The Brag Media and Vinyl Group, creating some of the country’s largest and most innovative events and activations, it is an exciting step in our 15-year history to officially join Vinyl Group."
"We look forward to bringing our expertise and accelerating the growth and profitability of events and activations across the wider organisation," Stephenson added.
The acquisition is subject to completion deliverables, necessary shareholder, ASX and/or ASIC consents and approvals, and no material adverse changes before completion, which is expected by no later than Dec. 31.