Our researchers have been looking in more detail at the recent disposal of TrainFX by Vision Media Group (VMG) and doing a bit more digging around especially as we rarely spot / think about everything first time round!
It looks like VMG will receive UK PDS 1.45 million in 2008 (only) if New Planet Investments (NPI) Limited themselves raise UK PDS 2 million (NPI are the new owners of TrainFX).
We still think that VMG have done well with this transaction, if TrainFX is successful (which we doubt by the way) then VMG’s 25% of that business would be worth something AND if NPI do raise private equity, AIM or PLUS money than VMG gets some cash (this year).
Most importantly VMG gets its Derby office, debt and some capex off of its balance sheet, which it can well do with.
Lastly, it is worth saying that we have never, ever liked the TrainFX business (when ScreenFX were doing MallFX, HealthFX and TrainFX – both of the latter were a brand extension too far).
By our reckoning, TrainFX would probably need about UK PDS 10 million more investment to get it to a stage where it needs to be and where it ought to be.
That’s an awful lot of cash, especially in the current climate. Either way (we may be wrong) but at least now, TrainFX has an owner / owners who can focus on one piece of business. Screens in trains is a niche after all (now they just need scale!!!).