WiseTech Global’s billionaire former CEO Richard White may be on leave from the company he founded 30 years ago, but he’s keeping busy on the business front, increasing his stake in ASX-listed Vinyl Group via a deal involving another one of his investments, the music licensing startup Songtradr.
White stepped down as WiseTech’s boss last Thursday, along with resigning from the Tech Council of Australia board, following a torrid fortnight of media revelations involving a court case with an alleged former lover, and questions over his workplace behaviour and interactions with women entrepreneurs that saw one dub him the “LinkedIn lecher”.
But in the meantime, Vinyl (ASX: VNL) has also been busy, cutting a deal with US-based music licensing marketplace Songtradr to manage and sell advertising across its platforms.
Vinyl owns blockchain music startup Serenade, music credits database Jaxsta, Web3 collectibles platform Serenade, the Tinder-style musician social network Vampr, and The Brag Media, which publishes Rolling Stone, Variety and other titles in Australia,
White sits in the middle of a Venn diagram of the two companies. He invested $11 million in Vinyl last year when the company acquired Brag Media and has invested repeatedly in raises for Songtradr, founded by expat Australian songwriter, producer and entrepreneur Paul Wiltshire.
Songtradr had held around a 20% stake in Vinyl Group, including a $1.564 million convertible note.
White’s majority-owned investment vehicle, Realwise Holdings has acquired the convertible note, which includes principal and interest of $1,564,748.85, and 55,804,916 of the 92,304,916 vested options held by Songtradr at a conversion price of $0.021 for a total of 74,511,370 ordinary shares.
Vinyl scores $771,547.24 in cash in the exercise of 36.7 million options, while debt is reduced by $1.564 million. Another potential $2.2 million sits on the table from future options.
The current deal takes the RealWise stake in Vinyl 37.37%. RealWise was already the largest shareholder with a 34% holding after converting its convertible note into $6,955,413 worth of ordinary shares at $0.04482 per share in April this year.
Songtradr retains 36,500,000 previously vested options as part of the sale to Realwise, which can be exercised for a total of $766,500.
Vinyl Group CEO Josh Simons said the deal strengthens the company financial position without diluting shareholder value.
“These movements are most welcome as they achieve a couple of important needs for the company that we have been working to resolve,” he said.
“The first being to reduce all debt in the Company to have the best financial condition to secure the Company’s future.
“The second matter was to bring in funds from the expected option exercise forward to utilise the funds now without further dilution to shareholders. This immediate exercise covers the cost of the Mediaweek purchase and restores our cash position.”
Vinyl Group shares have climbed 9% over the past month, but have fallen 4% in opening trade today to $0.12 cents.
WisTech shares have recovered more than 14% since a low of $99.97 on Thursday before White announced his resignation as CEO and from the board, climbing above $114 in Tuesday morning trade.
He is currently on leave from WiseTech, which celebrated its 30th anniversary last week.
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