Seventh Street Holdings, led by former Brag Media co-founder and CEO Luke Girgis, claims that Vinyl Group did not properly remunerate him and had broken terms of the sale agreement.
Luke Girgis, the former boss of Brag Media, has taken Vinyl Group to the Supreme Court of NSW and is seeking at least $2 million in performance related payments that were part of the sale agreement.
In December 2023, Vinyl agreed to acquire Brag Media – Australia’s largest youth publisher – for $8 million with a further $2 million payable in cash or stock based on financial performance. The acquisition followed an $11 million cash investment into Vinyl by WiseTech Global CEO & Founder Richard White.
Months after the deal closed in February 2023, Girgis, who was serving as managing director on a two year earn out, suddenly left the business with Vinyl claiming at the time that it had undergone a review of the business to save $750,000.
B&T understands that Girgis has not been paid his performance payouts and that he had minimal contact with Vinyl’s leadership team from the point the business was acquired to his June exit.
In a statement of claims, Girgis is challenging the nature of his departure and said that it occurred without cause.
Vinyl Media refutes this, claiming: “Mr Girgis was terminated for serious misconduct, including but not limited to financial misconduct”.
“The performance payment was contingent on specific financial targets being met and subject to Mr Girgis’ employment agreement not being terminated other than for cause or where Mr Girgis being convicted of an indictable criminal offence or any act of fraud. These financial targets were not achieved by The Brag Media business,” Vinyl Media said in a statement.
Since Vinyl Media released the statement, its share value has declined by between 7-10 per cent in early trading today.
Girgis set up Brag Media with Sam Benjamin and Poppy Reid nearly eight years ago. It has grown to become one of Australia’s largest youth culture publishers with owned brands including TheBrag.com, The Music Network and Tone Deaf, and Penske Media Corporation titles Rolling Stone and Variety in Australia and New Zealand.
The business also represents HypeBeast, Billboard, Rotten Tomatoes, Game Revolution, IndieWire, The Hollywood Reporter and more.
Benjamin left the business after the sale and Reid, who was editor in chief of Rolling Stone and Variety, departed a few months after Girgis. Award-winning creative director Katie Taylor also left the business last year.
The next court hearing is due on the 5 March.
