The board of French music label Believe supports the offer to go private at 15 euros ($15.98) per share, with the three independent board members voting unanimously that the offer is in the interests of minority shareholders . the company announced on Friday (April 19).
The offer to take Believe private came from a consortium of funds managed by TCV and EQT X, along with the chairman/CEO of Believe Denis Ladegaillerie. The joint venture's shares, together with the shares acquired from TCV Luxco BD S.à rl, Ventech and XAnge, gave it 79.1% of Believe's share capital. That left the board's three independent directors — the others tied to the consortium — to make a recommendation to minority shareholders.
The independent directors believe the joint venture offer is “aligned with management's strategy, while benefiting from the support of key shareholders aligned with its growth plan and with the ability to support the Company in its next phase of growth and consolidation market”. the company said on Friday. He also noted that minority shareholders receive the same price offered to majority block shareholders.
An independent expert, Ledouble, concluded that the consortium's offer is financially fair and lacks “ancillary elements” that could be detrimental to shareholders. Citigroup, hired by the company as a financial adviser, also told the board that the share price is economically fair to shareholders.
The consortium announced on Friday that it intends to submit its bid “in the coming days”. The offer of 15 euros per share is 21% above the share price the day before the consortium announced its takeover offer and 38.2% above the average of the last 20 trading days, according to the announcement. However, the consortium's offer is lower than Believe's IPO price of 19.50 euros ($20.78).
No competing bids came in for Believe, which includes digital distributor TuneCore, labels such as Groove Attack and Nuclear Blast, and a global infrastructure that provides artists and labels with tools and services. A month after the joint venture's initial offer was made public, Warner Music Group announced its interest in Believe at “at least” €17 per share. However, after being given access to a “data room,” according to the release, WMG chose not to make a competing bid.
After the joint venture takes Believe private, the company “will have all the necessary resources to continue the remarkable growth momentum the company has experienced in recent years,” Ladegaillerie said in a statement. “With the active and continued support of TCV, which has been with Believe since 2014, and the expertise of EQT, I am confident that we will continue to make Believe the global reference for independent music, taking advantage of all the growth opportunities that the digital transformation offers of the music market, to put them at the service of creation and creators”.
