For Immediate Release: March 2008
Hecta Media Inc (AIM: HCTA), the web consolidator, is pleased to announce the acquisition of popular blog, Tutorialblog.org, and a number of portfolios of domain names consisting of over 60,000 domain names.
The Company has today acquired a portfolio of approximately 60,000 domain names for a cash consideration of US$1,450,000. The domain name portfolio comprises mainly German and other European parked domain names that receive direct navigation and search traffic which can be monetized through search links to generate click-through advertising revenues.
The Company intends to maintain the domain registration of those domain names that the Directors consider are capable of generating ongoing direct navigation and search traffic and click-through revenues in excess of annual registration costs. The Directors will also consider adding new content to those sites with higher visitor traffic to maintain traffic and revenues. There are no historic audited trading results available for the domain portfolio. Nevertheless, based on current monthly visitor traffic, the Directors estimate that the equivalent annualised revenue run rate of the domain names is approximately US$750,000 in aggregate and the Directors believe that the domain names are likely to make a positive contribution to earnings in the current year. Subject to the actual performance of the domain name portfolio, Hecta Media has the option for the next six months to acquire a further two additional domain name portfolios for a further total consideration of US$1,900,000. A further announcement will be made in due course.
In addition, the Company has also acquired three other smaller domain portfolios from separate vendors, as well as the web design blog, TutorialBlog.org, which is a popular, high-traffic website that provides design tips and tutorials to the web design community. The total consideration for these additional portfolios amounts to US$445,000 in aggregate of which US$415,000 has been satisfied in cash and the balance of US$30,000 by the issue of 368,242 new Hecta Media Ordinary Shares of no par value (“Ordinary Shares”) to the vendor of TutorialBlog.org who has agreed not to dispose if its interest in the new Ordinary Shares for a period of six months other than in certain limited circumstances. No audited historic trading figures are available for the domain portfolios but the Directors believe that based on current visitor traffic, these portfolios are capable of making a positive contribution to Hecta Media’s earnings.
The new Ordinary Shares being issued will rank pari passu with the existing Ordinary Shares in issue and application will be made for the 368,242 new Ordinary Shares to be admitted to trading on AIM.
Clark Landry, CEO of Hecta Media Inc, commented:
“We are delighted to have acquired TutorialBlog and these domain name portfolios. In each instance, we have acquired assets with attractive traffic, revenue and profit potential at sensible valuations. We believe that considerable value can be added to each portfolio by bringing them under the Hecta Media umbrella and we look forward to developing the presence and breadth of service of TutorialBlog.org.
We are excited by the quantity and quality of potential website and domain opportunities that we have encountered since our admission to AIM in November last year. We believe that there are significant opportunities to continue acquiring online assets in line with our investment strategy that will make a positive contribution to the Company’s financial performance.”
Hecta Media Inc
Clark Landry (CEO) Tel: + 1 310 570 3820
Beaumont Cornish Limited
Roland Cornish Tel +44 (0) 20 7628 3396
gth media relations
Toby Hall /Christian Pickel Tel: +44 (0) 20 7153 8039/8036
Or visit the group’s website at www.hectamedia.com