According to Future: The sale will be made on a cash-free and debt-free basis. Completion will occur on 16 April 2013.
As well as Classic Rock and Metal Hammer magazines, the sale includes associated periodicals Prog and AOR, as well as branded events The Golden Gods and The Classic Rock Roll of Honour.
The sale of these activities is consistent with Future’s strategy of active portfolio management and will be followed by a further review of the cost base of the business. Future generates nearly 25% of its revenues from digital markets and has prioritised the development of international digital brands in Technology, Leisure and Sport.
The net sale proceeds will be used to reduce the level of bank debt and provide additional headroom under the Group’s new credit facility for further strategic digital investment. Future retains a portfolio of music-making titles and the musicradar.com website.
For the year ended 30 September 2012, the revenue, gross contribution and adjusted pre-tax profit attributable to these brands were £8.6m, £1.8m and £0.2m respectively. At 30 September 2012, the gross assets relating to these brands were £6.6m.
Mark Wood, Future's Chief Executive, said: “Classic Rock and Metal Hammer generate revenues predominantly from print. Their sale is in line with Future's strategy of prioritising products which are international and digital. These two iconic print brands have not been central to that strategy and will thrive within a broader music business.”
TeamRock is a new company formed to provide and create premium content to rock music fans across the world via digital platforms and through the Classic Rock and Metal Hammer titles.
Billy Anderson, TeamRock Chief Executive, says: “We are delighted to acquire these wonderful brands that will play a significant part in the development of our larger business. They come with a great team led by Chris Ingham and we look forward to investing further in their development.”
John Myers, TeamRock Executive Chairman, adds: “This is a great business and is the first building block of our wider ambitions. We expect to announce further developments within the next day or so.”
