By Warner Music Group on Thursday confirmed that it has approached French digital music company Believe SA “to initiate discussions with respect to a potential combination of Believe with WMG” with a price indication of “at least €17 per share based on currently available public information.”
The French company previously said that its founder and CEO Denis Ladegaillerie had partnered with two investment firms to take the company, whose stock was listed in Paris less than three years ago, private.
Believe’s stock has been trading at around €15.50, giving it a market capitalization of around €1.60 billion, with WMG’s comments signaling it would offer at least €1.65 billion ($1.80 billion) in an acquisition.
Believe, whose brands include TuneCore, Nuclear Blast, Naïve, Groove Attack, Play Two and AllPoints, is known for scouting singers and helping them launch their careers online. Warner Music sees an opportunity to integrate Believe into its global business.
In a statement, the global music major, led by CEO Robert Kyncl, said it “considers that such a combination would be beneficial to the company and all of its other stakeholders (shareholders, employees, artists and labels). As opposed to the purely financial transaction contemplated by the consortium formed by EQT, TCV, and Denis Ladegaillerie announced on February 12, 2024, WMG would provide Believe with strategic support and financial stability to help the development and growth of the company, including by accelerating its expansion into new geographies.”
WMG added that it “envisages financial terms that would be more attractive than those announced by the consortium,” adding that the transaction “could be for cash only, without WMG excluding the possibility of a share component, and without any financing conditions.”
The music major said it was “currently awaiting access to the due diligence information requested on February 27,” which it “considers key to allow it to submit a formal proposal.”
