Hair and Beauty Vertical AcquisitionBig Un Limited (
Share Purchase Details
$3m Advertising Revenue Anticipated from BHA
As previously announced on 30th November 2016, The Intermedia Group will be issued with 3.26m BIG Ordinary Shares at completion with a further 3.26m BIG Ordinary Shares to be issued subject to BHA achieving $3m in advertising revenue in the 12 months to 31 December 2017. All shares will be placed in escrow for 12 months from issue.
BIG Opportunity to Build Relationships with Current BHA Advertisers
The acquisition of BHA will provide BIG with close relationships with large brand advertisers in the hair and beauty vertical. These relationships are anticipated to be strengthened by the ability to incorporate video technology as a marketing solution to reach SME's. Existing global brand advertisers include:
4 Sothys Paris
5 De Lorenzo
Access to SME Specialists in Hair & Beauty
Monetisation of Specialist SME database
In addition to advertising revenue, the acquisition will provide BIG with ownership of a database of 36,000 Australian SME subscribers who operate in the hair, beauty and aesthetics industries. This represents around 50% of the Australian hair and beauty market, making BIG a significant player.
BIG will now own leading Intermedia hair and beauty brands: Styleicons, Instyle, Professional Beauty and Spa and Clinic. The Company will offer existing print and digital subscribers access to video technology products.
Cost Saving Synergies
EBITA Multiple Reduction
The acquisition is structured at 4 x EBITA excluding synergies. However, combined cost savings result in approximately 2.5 x EBITA.
The acquisition of BHA provides aditional cost savings in comparison to BIG costs associated with the BIG/TIG joint venture agreement. The BHA team has strong relationships with advertisers and experience in digital advertising sales through it's digital publications including styleicons.com.au, professionalbeauty.com.au, and spaandclinic.com.au which will help raise BIG's profile with large advertisers and realise the revenue potential of the hair and beauty market in Australia.
Structured Growth with Revenue
BIG has already experienced a material uplift in revenue from the hair and beauty sector during the due diligence process. Further benefits to the Company as a result of the acquisition are as follows:
- Immediate additional advertising revenue of at least AU$3m per annum
- Established relationship with large advertising clients
- Acquisition includes ownership of a database of 36,000 Australian SME subscribers in addition to BIG's current membership base of over 23,000
- SME relationship dominance in the Australian hair and beauty vertical (which is particularly suited to video marketing)
- Expansion of current BIG SME membership pool
BHA Media Pty Ltd
Simon Grover, CEO of The Intermedia Group, will remain as a Director of the hair and beauty publishing arm and continue to provide valuable insights, experience and expertise. Richard Evertz CEO of BIG says: "Simon will continue to head the operations and day to day management of this vertical. The acquisition of BHA by BIG allows both parties to operate as one and fully monetize and grow the video technology and advertising opportunities in this market."
About Big Un Ltd
BIG (ASX:BIG) is the parent company of Big Review TV Ltd. Big Review TV are innovative disruptors in the online video space delivering subscription based video technology products and services. The Company has operations across Australia and in New Zealand, the United Kingdom and the United States, Hong Kong, Singapore and Vancouver and was listed on the ASX in December 2014.