Masterfile Update

Posted on 6/24/2015 by Jim Pickerell | Printable Version | Comments (0)

Several of my readers have differing opinions with regard to the meaning of the term “no exchange of equity” as it appeared in Masterfile’s May press release. I thought it meant that no money changed hands. I asked Steve Pigeon, CEO of Masterfile, for clarification.

SP - The financial terms of the transaction are confidential.  However, the reference to “no exchange of equity” means that Mediapro acquired no shares in Masterfile Corporation (“MFC”) and MFC acquired no shares of Mediapro.  We are independent companies operating at arms’ length.  However, due to Mediapro’s reliance on Masterfile for content, branding and the Masterfile website, Mediapro’s CEO, Alfred Höfinger, has been granted a seat on the Board of Directors of MFC.

JP - Previously, were all the expenses of the Mediapro operational costs covered by Masterfile and now Mediapro operates as a separate independent company or was Mediapro a separate company all along and just received a percentage of revenue generated?

SP - Mediapro is a new company that was formed under the direction of Mr. Höfinger specifically to acquire the European subsidiaries of MFC.  It did not exist prior to this transaction.  MFC was ultimately responsible for the operational costs of the Masterfile European subsidiaries up to April 30, 2015.  On May 1st, these costs became the sole responsibility of Mediapro.  In the new paradigm, Mediapro will pay a royalty to MFC for the licensing of Masterfile images in Europe.  The royalty ultimately paid to Masterfile’s contributors by MFC is unaffected by the ownership change.

JP - I can’t see how this change in relationship will necessarily increase Mediapro sales so it would seem that to benefit them it would have had to cut their costs.

SP - Mediapro is an independent company that will operate the former Masterfile subsidiaries as it deems appropriate, so any decisions about cost management, investment in growth, etc. will be the realm of Mediapro.  However, as stated in the press release, Mr. Höfinger intends to grow the business.

JP - I assume that Masterfile’s costs of operations have been reduced by no longer having to manage the European operation.

SP - That is correct.

JP - Is there a tax advantage in operating in this manner?

SP - Not that I am aware of.  However, it simplifies the corporate structure of MFC and the costs associated with controlling business entities in Europe. That was our objective.

JP - What happened to Tomas Speight?

SP - Tomas has been replaced as Managing Director in each of the European companies by Alfred Höfinger, the CEO of Mediapro.  Tomas will be looking for new opportunities but will be consulting with Mediapro over the coming 4-10 months to ensure a smooth transition.  Both Tomas and Alfred have been business associates for years so the changing of the guard has been handled in a very amicable fashion.

Copyright © 2015 Jim Pickerell. The above article may not be copied, reproduced, excerpted or distributed in any manner without written permission from the author. All requests should be submitted to Selling Stock at 10319 Westlake Drive, Suite 162, Bethesda, MD 20817, phone 301-461-7627, e-mail: wvz@fpcubgbf.pbz

Jim Pickerell is founder of, an online newsletter that publishes daily. He is also available for personal telephone consultations on pricing and other matters related to stock photography. He occasionally acts as an expert witness on matters related to stock photography. For his current curriculum vitae go to:  


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