Believe's board on Monday (March 25) asked Warner Music Group (WMG) to make a formal bid for the French music label after it said French financial regulators had found a bid from a group that includes Believe's CEO Denis Ladegaillerie violated certain securities rules.
WMG said earlier this month that it approached Believe in February with a non-binding offer to combine the two companies for “at least” 17 euros ($18.60) per share. It now has until April 7 to “submit a binding, unconditional and fully funded offer,” according to a statement from Believe's board.
Asking for a takeover bid to compete with one from the company's chief executive is unusual and marks an escalation in the fight for control of Believe. In its statement, Believe's board said the bid by Ladegaillerie and investment firms EQT X and TCV “did not comply with the rules governing bids”.
Ladegaillerie and investors had offered to take Believe private at a price of 15 euros per share — or about 1.523 billion euros ($1.64 billion) for the company. After learning of WMG's approach, the consortium sought to speed up the takeover process by waiving the condition that the board's ad hoc committee receive an independent expert report on the financial fairness of its bid. A review by the French financial regulator, Autorité des marchés financiers (AMF), said the group could not waive this condition.
“The Board must allow … that all Believe shareholders have the opportunity to benefit from the best possible offer, to the extent that such offer is reasonably likely to be successful,” the board said in a statement earlier this month.
Believe has a large label services business, digital distributor TuneCore, publishing management service Sentric and a stable of labels including Naïve, Nuclear Blast and Groove Attack. The company's business model is based on helping artists develop and using digital marketing and distribution to influence the local charts. In 2023, the company posted revenue of €880.3 million ($952.8 million at average exchange rates), up 15.7% year-on-year, helped by geographic expansion and strong streaming growth.
