The new ownership structure of Believe is taking shape.
The company confirmed today (June 24) that 94.99% of its share capital is now owned by a consortium consisting of EQT X, TCV, and Believe founder Denis Ladegaillerie.
The Ladegaillerie consortium offered EUR €15 per share in its takeover bid; Believe’s public shareholders had until Friday (June 21) to accept or reject that bid.
Ladegaillerie’s consortium had previously secured the acquisition of 71.92% of Believe via a ‘Block Acquisition’ at this price from existing shareholders: 59.46% from TCV Luxco BD S.à r.l., Ventech and XAnge; plus Ladegaillerie’s 12.5% stake.
In total, Ladegaillerie and co have now acquired 95,664,105 shares at a cost of EUR €1.43 billion (around USD $1.54 billion at current exchange rates).
That said, two parties in the new consortium—Ladegaillerie and TCV—have effectively acquired shares from themselves via that ‘Block Acquisition’.
The Ladegaillerie consortium’s bid values Believe’s entire share capital at approximately €1.51 billion ($1.62bn).
EQT has previously said that, via its stake in the Ladegaillerie consortium, it expects to be “30-35% invested” in Believe; this implies that EQT X owns around a third of the equity in the consortium (‘Upbeat Bidco’).
Discussing the acquisition of the consortium’s 94.99% of Believe’s shares, Denis Ladegaillerie said today: “Following the friendly takeover bid we initiated, the Consortium now holds 95% of Believe’s capital.
“Our shareholders have overwhelmingly decided to tender their shares to the offer, leading to a real success! With enhanced financial agility and the proven expertise of the Consortium members, the group is now best equipped to achieve our collective goal: to make Believe the global leader in independent music, serving artists and labels worldwide.”
An interesting quirk of the new ownership structure (as you can see above): It leaves 5.01% of shares as ‘free float’ on the Euronext public market.
According to Euronext’s FAQs (see below), the stock exchange requires each company to float a share capital of at least 5% of their firm (so long as that 5% is worth more than €5 million).
In other words, it seems at least possible that the 5.01% of public shareholders who haven’t accepted Ladegaillerie and co’s €15-per-share offer could yet be permitted to continue to hold/trade their shares on the Paris Euronext.
Aligned with this new shareholding structure and Ventech selling its entire share in Believe, the company’s board of directors has seen some changes.
Joining Believe’s board as a representative of EQT X is Andrew Fisher.
Fisher is the former CEO of Shazam, part of what Believe calls Fisher’s “extensive experience in the music industry”.
Fisher’s ratification onto Believe’s board will be submitted to the vote of the company’s AGM next year in 2025.
Believe’s board of directors has also appointed two observers, Michael Kalfayan (General Partner at TCV) and Nicolas Brugère (Partner at EQT, Head of France & Benelux).
Earlier this year, Warner Music Group made a competing $1.8 billion approach to potentially acquire Believe, but this ultimately fell 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 initially launched its offer for Believe in February.
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