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Media Central Corporation Inc
Symbol FLYY
Shares Issued 338,325,802
Close 2020-10-01 C$ 0.015
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Media Central to acquire Varipay

2020-10-02 10:56 ET - News Release

Mr. Brian Kalish reports

MEDIACENTRAL SIGNS LETTER OF INTENT TO AQUIRE VARIPAY INC.

On Oct. 1, 2020, Media Central Corp. Inc. entered into a non-binding letter of intent to acquire Varipay Inc. (VP). The LOI represents a strategic acquisition to boost Media Central's aggressive e-commerce initiative bolstering sales and marketing synergies across all digital platforms.

  • Publishing company to acquire e-commerce processing capabilities with latest acquisition;
  • Varipay to become a wholly owned subsidiary of Media Central;
  • Acquisition will increase revenue opportunities for Media Central's e-commerce platform linked to company's popular digital media sites;
  • Acquisition of profitable business that is experiencing rapid growth in its market;
  • Varipay is poised to capitalize on rapidly emerging segments complementary to Media Central's digital focus including e-sports, gaming and cannabis.

Varipay is a digital payment processing company with established clients in industries such as pharmaceuticals, nutraceuticals, cannabis and CBD (cannabidiol), health care and media. Varipay currently offers e-commerce integration, POS (point-of-sale) retail processing and virtual terminals to its merchants. Varipay is expected to launch its mobile app in Q4 2020. The mobile app will provide customers with peer-to-peer funds transfer capabilities with full integration into retail environments and e-commerce websites. In fiscal 2019, Varipay processed $15.56-million in transactions generating total revenue of $1.65-million and $27,000 earnings before interest, taxes, depreciation and amortization. For the six months ended June 30, 2020, VP processed $9.50-million in transactions generating revenue of $1.23-million, compared with $5.16-million and $438,000, respectively, in the first half of 2019. Resulting year-over-year growth was 83.9 per cent in transaction volumes and 127-per-cent growth in revenue. During the same six-month period Varipay achieved EBITDA of $193,000 compared with an EBITDA loss of $144,000 in 2019.

"The company's previously announced acquisition of Budtree.com will not be proceeding," said Brian Kalish, chief executive officer of Media Central. "We have, however, developed another, more favourable opportunity, presented by the same Budtree.com vendors. Varipay is a building block to enhancing our in-play e-commerce strategy -- across all of our digital platforms. The strong profile of its growing revenue and profitability should significantly enhance shareholder value."

Media Central expects to integrate Varipay into its e-commerce platforms and popular digital media sites which include: Toronto's Now Magazine, Vancouver's Georgia Straight, the CannCentral website and the ECentralSports website.

Media Central and Varipay will work to entering into a definitive agreement within 30 days subject to completion of mutual due diligence, a comprehensive business valuation report of Varipay, financial audit of Varipay, regulatory approvals and consent from certain of Media Central's significant shareholders. It is expected that the acquisition will be by way of a share exchange which will result in Varipay becoming a wholly owned subsidiary of Media Central. Based on the projected 20-day volume-weighted average price of the company's stock, on closing, Media Central is expected issue approximately 200 million shares to the shareholders of Varipay in exchange for their shares in Varipay.

On the successful closing of the transaction, the shareholders of Varipay will nominate two individuals to join Media Central's board of directors. A finder's fee of up to 6 per cent of the value of the transaction may be payable following the closing of the acquisition.

About Media Central Corp. Inc.

Media Central is an alternative media company situated to acquire and develop high-quality publishing assets starting with the recent acquisition of Vancouver Free Press Corp., the purchase of NOW Communications Inc. and the launch of digital cannabis platform CannCentral and e-sports outlet ECentralSports. Media Central is consolidating and digitally monetizing the over 100 million coveted and premium consumers of the approximately 100 alternative urban publications across North America, creating the most powerful audience of influencers.

About Vancouver Free Press Corp.

Vancouver Free Press owns and operates Georgia Straight and the Straight website. Established in 1967 as the news, lifestyle and entertainment weekly in Vancouver, the Georgia Straight has been an integral part of the active urban West Coast lifestyle for over 50 years. Reaching over 56 million annual readers, every Thursday in print, and every day at the Straight website, Georgia Straight delivers an award-winning editorial package of features, articles and reviews. Regular coverage includes news, tech, arts, music, fashion, travel, health, cannabis and food, plus Vancouver's most comprehensive listings of entertainment activities and special events. Vancouver Free Press is a wholly owned subsidiary of Media Central.

NOW Central owns and operates NOW Magazine and the NOW Toronto website. Since 1981 NOW has been Toronto's news and entertainment voice, published in print every Thursday, and daily at the NOW Toronto website. Reaching over 25 million annual readers, NOW has been a leading publication, defining and pioneering the independent and alternative voice for more than 38 years. NOW Central Communications is a wholly owned subsidiary of Media Central.

About CannCentral Inc.

With unique daily content appealing to both new and experienced cannabis consumers, CannCentral is poised to become the leading digital publisher for all things cannabis. Presenting authentic news and lifestyle content through a verified lens, CannCentral is emerging as an industry-leading authority on knowledge, product and insight for cannabis enthusiasts, patients and investors around the world. CannCentral is a wholly owned subsidiary of Media Central.

About ECentralSports

ECentralSports is a dynamic digital destination for e-sports fans in search of the latest in news, competitive gaming coverage, analysis, events, lifestyle features and gaming culture. With a strong focus on covering cultural, artistic and social subjects from deep within the e-sports world, ECentral provides the ultimate insider guide to the industry. ECentralSports is a wholly owned subsidiary of Media Central.

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