Future plc buys back music magazines from Team Rock
Former owner, which sold the titles for around £10.2m, have bought them back for less than one-tenth the sales price in 2012
Future plc has bought back the music magazines of Team Rock for the paltry sun of £800,000, saving Classic Rock, Metal Hammer and Prog from being shuttered.
“The acquisition of these classic rock brands with their associated magazines, events and websites marks a further step in our buy and build strategy,” Zillah Byng-Thorne, chief executive of Future, said in statement.
“It further reinforces our creation of a leading global specialist media platform with data at its heart, which we are monetising through diversified revenue streams. We look forward to developing further these iconic and mich-loved brands and to continuing to serve their communities of dedicated enthusiasts around the world.”
Team Rock had gone into administration after failing to raise additional capital. The company, founded in 2012 by former GMG Radio executives John Myers and Billy Anderson, and had acquired their magazines for around £10.2m in 2012. Their emphasis was less on publishing than digital radio and events, likely the areas of interest to Future’s management team today.
“The company explored every option to secure the long-term future of the business, however the constraints on the cash position of the business were such that administration was the only viable option,” said Tom MacLennan of FRP Advisory at the time the publisher went under.
Revenue has fallen to around £6.5 million in the 2015, according to UK media, and it is certainly not profitable, making it hard to come up with a good sale price. But, generally, magazines are sold at between 1 and 2 times revenue, with 1x revenue being the floor for magazines that are not profitable. But all M&A rules get thrown out the window once a title is shuttered, or a company goes bankrupt. Many of the B2B titles of Nielsen and Reed were sold for pennies on the dollar after they could not initially find buyers.