Iconic Labs buys stake in student news website The Tab
Iconic Labs has bought an indirect stake in student publishing company The Tab, marking the latest move in the media firm’s aggressive acquisition spree.
Iconic Labs has secured a 24 per cent stake in media investment vehicle Medium Channel Media (MCM), which in turn has entered into a conditional agreement to acquire The Tab.
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As part of the deal, Iconic will provide management and consultancy services to MGM, as well as a loan of £150,000.
In addition, MGM has agreed to pay a monthly retainer to Iconic of at least £25,000.
Iconic, which is run by three former Unilad executives, said its expertise would enable The Tab to boost programmatic advertising revenue and build up its commercial presence, which is key to developing branded content.
But investors appeared unconvinced by the deal, with shares in Iconic Labs falling as much as eight per cent, before recovering to a fall of just under one per cent.
“Given our experience in creating Unilad, we feel confident in our ability in adding value and increasing revenues at The Tab through our involvement once MCM has completed the acquisition,” said chief executive John Quinlan.
“We have always thought they had the most credible brand in the sector and we are looking forward to working on it through our agreement with MCM.”
In a further stipulation of the deal, Iconic will receive a “substantial” percentage of all profit if certain targets are met. The Tab pulled in revenue of roughly £1.3m last year.
MCM was set up by Richard Thompson, a non-executive director at Iconic Labs, with the purpose of investing in media and tech companies.
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The acquisition is the latest move in a rapid expansion plan by Iconic Labs, which was set up in March as the media division of stem cell firm Widecells.
Earlier this week the firm snapped up the intellectual property of LGBTI publisher Gay Star News, while it has also agreed a deal for Social Alchemist, a creative agency and distribution network founded by a former Ladbible director.
Main image credit: The Tab