Stingray signs definitive agreement to acquire TuneIn

Executive Summary

• Stingray Group Inc. has entered into a definitive agreement to acquire TuneIn Holdings Inc., a leading live audio streaming and advertising platform, in a transaction valued at up to $175 million (U.S.).
• The acquisition is expected to significantly expand Stingray's global digital audio footprint, combining its premium content with TuneIn’s ad monetization technology and extensive device partnerships.
• The combined entity is projected to generate pro forma revenue exceeding $400 million (U.S.), solidifying its position as a major player in the digital audio advertising market.

Key Details

• Transaction Value: Up to $175 million (U.S.), based on TuneIn's forecasted sales of $110 million (U.S.) and adjusted EBITDA of $30 million (U.S.) for the 12-month period ending December 31, 2025.
• Payment Structure:
  • $150 million (U.S.) payable at closing.
  • Up to $25 million (U.S.) payable 12 months following closing.
• Financing: Stingray secured an additional $150 million (U.S.) term loan under its renewed credit facility to finance the acquisition.
• Closing Conditions: Subject to approval by TuneIn's stockholders, applicable regulatory approvals, and customary closing conditions.
• Expected Closing: By year-end 2025.
• Strategic Rationale:
  • Combines Stingray's premium music/video content with TuneIn's ad platform (targeted audio, video, and display advertising).
  • Enhances reach through TuneIn's partnerships with major device manufacturers, automotive companies, and content providers.
  • Expands presence in the automotive sector, leveraging existing integrations with leading manufacturers.
• TuneIn Metrics:
  • Over 75 million active listeners monthly worldwide.
  • Access to more than 100,000 radio stations, podcasts, music channels, news, sports, and audiobooks.
  • Distributed across more than 200 platforms and connected devices, including over 50 in-car audio systems in over 100 countries.
• Pro Forma Financials: Combined entity's pro forma revenue expected to exceed $400 million (U.S.) ($560 million Canadian).
• Post-Acquisition Operations: TuneIn will continue to operate under its existing brand.
• Advisers:
  • Stingray: National Bank Capital Markets (Financial Adviser), Davies Ward Phillips & Vineberg LLP (Legal Counsel).
  • TuneIn: Houlihan Lokey Capital Inc. (Financial Adviser), Skadden, Arps, Slate, Meagher & Flom LLP (Legal Counsel).

Notable Quotes

• Eric Boyko, President, Co-founder and CEO of Stingray: "This acquisition marks a pivotal moment in Stingray's journey to further strengthen its position as a global leader in audio entertainment and digital advertising sales... Together, we are poised to redefine audio for a connected world, delivering extraordinary value to our listeners, content partners and advertisers."
• Richard Stern, Co-chairman and CEO of TuneIn: "Stingray is the ideal partner to propel TuneIn's next chapter of growth... Joining forces with Stingray allows us to accelerate our mission of delivering the world's best audio content to listeners everywhere, while creating powerful new avenues for advertisers to connect with a highly engaged audience."