A consortium led by Denis Ladegaillerie, founder and CEO of Believe, has secured over 85% of the company’s shares in its takeover bid.
This advances the consortium’s effort to take Believe private.
In an update to the market on Friday (June 140, the consortium, Upbeat BidCo, said it has acquired 85.04% of Believe’s share capital and 73.27% of its voting rights through agreements and its simplified public tender offer.
The offer allows remaining shareholders to sell their shares at EUR €15 ($16) per share until the end of this week (June 21). It also leaves the free float of Believe at 14.96% of its issued share capital.
With over 85% of shares controlled, Upbeat BidCo. could force remaining shareholders to sell through a “squeeze-out” procedure at the end of the offer.
While the consortium — which also includes investment firms EQT and TCV — has stated they do not intend to pursue this option, the decision may have consequences for the remaining shares. Because less than 15% of Believe’s shares will be publicly traded after the offer closes, stock exchanges may choose to delist them from certain indices.
“The fact that the free float represents less than 15% of the share capital should lead to Believe’s shares soon being removed from certain stock market indexes to which Believe currently belongs.”
Upbeat BidCo
“The fact that the free float represents less than 15% of the share capital should lead to Believe’s shares soon being removed from certain stock market indexes to which Believe currently belongs,” the consortium said.
France-headquartered Believe has been listed on the Euronext Paris since 2021 after raising EUR €300 million ($321 million). It initially floated 14.35% of its equity through the IPO.
The development follows a months-long saga that saw a competing bid from Warner Music Group fall through. Warner had considered making a EUR €17-per-share-plus offer to acquire Believe but decided not to pursue it in April.
Ladegaillerie’s consortium made its offer for Believe in February. The group’s €15-per-share offer represents a 21% premium on Believe’s closing price on February 9, and values the company’s 100% stake at €1.523 billion (USD $1.63billion).
Prior to the competing bid from Warner, Upbeat BidCo had already secured agreements to acquire 71.92% of Believe from existing shareholders: 59.46% from TCV Luxco BD S.à r.l., Ventech and XAnge; and Ladegaillerie’s 12.5% stake.
Believe is a digital music company that provides a range of services to help artists grow their audience and careers, from distribution and promotion to technology and expertise.
“Believe has a significant opportunity ahead to consolidate the independent music market and create the first global major independent, at the service of artists at all stages of their career,” Denis Ladegaillerie, founder, Chairman & CEO of Believe, said in February.
“In achieving this ambition, I am glad to continue benefiting from the active support of TCV who has accompanied Believe since 2014 and to be partnering with Europe-based EQT who has a great track record in supporting high-growth companies.”
Music Business Worldwide [STAGING]