Tiny Ltd. Acquires Majority Stake in Serato Audio Research in US$66 Million Deal

Tiny Ltd. (TSX.V: TINY) has acquired a 66% interest in Serato Audio Research, a leading global audio software company, in a transaction valued at US$66 million. The acquisition, advised by Roth Canada, involves US$23.6 million in Tiny common shares and US$42.4 million in cash. This strategic move positions Tiny Ltd. to expand its technological capabilities and market presence in the audio software industry.

The deal implies a valuation of 3.2x annualized revenue and 9.6x adjusted EBITDA based on financial results for the nine months ended September 30, 2024. This acquisition underscores Roth Canada's commitment to supporting high-growth technology and digital platform businesses through strategic mergers and acquisitions and comprehensive capital market solutions. The transaction highlights the ongoing consolidation and investment in the digital technology sector, with a focus on strategic asset acquisition and innovative financing structures.

Concurrent with the acquisition, Roth Canada played a pivotal role in the transaction's financing. The firm co-led a C$20 million bought deal public offering of 17.4 million subscription receipts at C$1.15 per receipt and served as co-lead placement agent for a C$36.1 million private placement of convertible debentures. The total transaction financing reached C$56.1 million. This comprehensive financing approach demonstrates the sophisticated capital market solutions available for strategic technology acquisitions in today's market environment.

The acquisition of Serato Audio Research represents a significant expansion opportunity for Tiny Ltd. in the competitive audio software sector. By acquiring a majority stake in an established global player, Tiny Ltd. gains immediate access to advanced audio technology, established market presence, and proven revenue streams. The transaction structure, combining both equity and cash components, provides flexibility while maintaining financial discipline through carefully calculated valuation metrics that reflect both revenue multiples and profitability measures.