Founder of 3e Oeil Productions, the largest French independent media producer
Mediawan has offered to acquire an eligible target to complete its Initial Business Combination for a total consideration of approximately €270 million
Groupe AB is a leading player in production, distribution and aggregation of TV content in French-speaking Europe with a strong potential for growth acceleration through channels, digital and production that will serve as a platform for future acquisitions
Mediawan shareholders are invited to vote on the proposed Initial Business Combination during a special meeting to be held on 13 March 2017
A conference call will be held on 30 January at 13:00 CET (dial in details: +44 121 260 4861 / access code: 5197022#). The call will be accessible until 6 February 23:59 CET using the same dial-in details
• Announcement of the acquisition of Groupe AB: 30 January 2017
• EGM notice: 3 February 2017 (available below or in the Documents section)
• EGM: 13 March 2017 at 3pm CET (Hôtel Park Hyatt Paris-Vendôme in Paris)
• Closing of the transaction: H1 2017
Mediawan is a Special Purpose Acquisition Company (SPAC) that was recently formed for the purpose of acquiring one or more operating businesses or companies through a merger, capital stock exchange, share purchase, asset acquisition, reorganization or similar transaction. The Company intends to focus on the completion of an Initial Business Combination with one or several target businesses or companies with principal operations in the traditional and digital media content and entertainment industries in Europe (the “Initial Business Combination”).
The Company was formed by Messrs. Pierre-Antoine Capton, Xavier Niel and Matthieu Pigasse, each acting through and on behalf of controlled affiliated entities. The Company will have 24 months from the Listing Date to complete the Initial Business Combination.
The Company and the Founders have already identified potential target businesses and companies but have not engaged in discussions with any potential acquisition or combination candidates, nor do they have any agreements or understandings to acquire any potential target businesses or companies.
In 2002, Pierre-Antoine Capton founded 3e OEil Productions, a French audiovisual production company that he chairs as Manager (Gérant) and which is currently the largest French independent media producer.
The activities of the 3e OEil group, which in addition to 3e OEil Productions includes other entities such as Hide Park, CZ and Mondiale de Productions, involve TV production, theater production and other media production activities (cinema, music, trailers, short films, etc.). With respect to TV production, the content produced each year by the 3e OEil group increased from 50 hours in 2002 to 560 hours in 2014 with shows such as “C A Vous” which gathers around 1 million viewers every evening, and its customer base includes recognized clients such as the main French TV groups (TF1, France Télévisions, Canal+ and M6). In theater production, the activities of the 3e OEil group currently cover fifteen countries, including the United States and the United Kingdom.
Through his various activities, Pierre-Antoine Capton has demonstrated his ability to successfully export certain productions of the 3e OEil group across Europe and to provide content across various distribution channels and platforms.
Built the largest independent audio-visual producer
Productions successfully exported across Europe
Distribution of content across platforms
Xavier Niel is the founder and majority shareholder of the Iliad group, which owns leading French convergent telecom operator, Free. He currently serves as Senior Vice-President, director and Deputy-Chairman of the Board of Directors.
He is a self-taught entrepreneur and has been active in the data communications, Internet and telecommunications industry since the late 1980s. Prior to devoting himself to the Iliad group development, in 1993 he co-founded France’s first Internet service provider (ISP), Worldnet. Subsequently, after founding 3617 ANNU, the leading reverse look-up directory service on Minitel, in 1999 he went on to create Free – France’s first free-access ISP.
Xavier Niel was the architect behind the 2002 launch of the Freebox – the first multi-services box providing households with access to a triple play offering (Internet, telephone and television). He has also been the inspiration behind the group’s major strategic developments, including its current rollout of the 4G mobile network in France and its mobile offerings which were launched on January 10, 2012. The strategy of the Iliad group proved successful as (i) its total number of subscribers increased from 10.6 million in December 2012 to 17.8 million in December 2015, thus representing a compound annual growth rate (CAGR) of 19% over the period, and (ii) in the long-time oligopoly environment of French mobile operators, Free Mobile’s market share grew from 0% in 2011 to 17% in December 2015.
In parallel, for many years Xavier Niel has invested considerably in web start-ups. In March 2010 he set up his own investment fund, Kima Ventures, one of the world’s most active early-stage investors, which invests in 50 to 100 start-ups a year throughout the world. In addition, since 2010 he has held an ownership interest in the Le Monde newspaper, alongside Mr. Pierre Bergé and Mr. Matthieu Pigasse. Since summer 2014, Mr. Xavier Niel, Mr. Pierre Bergé and Mr. Matthieu Pigasse have also been the joint owners of the French weekly magazine L’Obs.
In March 2013, Mr. Niel created "42" – a revolutionary IT school which strives to train large numbers of computer specialists required by innovative companies. 42 is based on the “peer-to-peer learning” strategy and offers free training, which is open to all 18 to 30 year-olds. In September 2013, Xavier Niel announced the opening in early 2017 of the world’s largest start-up digital incubator – “1000 start-ups @la Halle Freyssinet” – which will be located in the Halle Freyssinet building in Paris.
Mr. Niel has also invested in the telecommunications sector for many years in a personal capacity through NJJ Holding. He acquired a 55% stake in Monaco Telecom in 2014 and Orange Switzerland (now renamed Salt) in February 2015.
Founded a telecommunications group which is currently valued more than €10 billion
Created the first triple play offer (Freebox) and contributed to making broadband more accessible in France
Created the world’s largest start-up incubator in Halle Freyssinet scheduled to open in 2017
Mr. Matthieu Pigasse, who currently serves as Global Head of Mergers & Acquisitions and Sovereign Advisory of Lazard Group and CEO of Lazard France, has developed a strong financial expertise and worked on the largest transactions led by the Lazard Group in recent years.
Through his personal investments, Matthieu Pigasse developed a deep understanding of the media sector. In 2009, he purchased the magazine Les Inrockuptibles of which he is chairman of the board of directors. Along with Mr. Pierre Bergé and Mr. Xavier Niel, Matthieu Pigasse became co-owner of the newspaper Le Monde in 2010 and of the French weekly magazine L’Obs in 2014. In 2012, he launched the French edition of the “Huffington Post” website. In 2015, he acquired Radio Nova. He is also a significant shareholder in a number of other media like Melty Group and VICE France. In 2015, he was appointed Chairman of one of the largest rock festival in Europe: Les Eurockéennes de Belfort, gathering over 100,000 people every summer.
Mr. Pigasse was also Dominique Strauss-Kahn’s technical adviser in 1998 before joining, one year later, Laurent Fabius’ cabinet as a financial and industrial advisor. As a former Chief of Staff of the French Minister of Economy and Finance, Matthieu Pigasse has an intimate knowledge of the public sector as well as the European Regulations.
Strong financial expertise as one of the leading M&A bankers worldwide
Deep understanding of media sector through his personal investments
Intimate knowledge of public sector and European regulations as former Chief of Staff of the French Minister of Economy and Finance
More specifically, the Company intends to use the net proceeds raised on the listing date, in order to invest in a group of high value-added media and entertainment content (press, radio, television, movies and/or digital) meeting the 75% threshold.
The main objective of the Company is to be present across all points of contact with consumers, readers, listeners, viewers and internet users by offering contents adapted to the technical environment and context of use where such contents are consumed. For such purpose, the Company intends to implement a contents/container strategy.
In the current complex environment faced by the European media and entertainment industries, the Company anticipates that some of the prospective target businesses and/or companies may be undergoing operational and financial challenges at the time when they are evaluated by the Company.
The Company has identified the following criteria and guidelines that it believes are important in evaluating prospective target businesses and/or companies:
1 / 6
the Company will seek to acquire one or several target businesses and/or companies already present in the content sector
2 / 6
the Company will seek to acquire one or several target businesses and/or companies presenting a significant value creation potential through restructuring, repositioning and reorganization
3 / 6
the Company will seek to acquire one or several target businesses and/or companies which is or are established and premier players in Europe and abroad, enjoying a leading brand recognition in the media and entertainment industries
4 / 6
the Company will seek to acquire one or several target businesses and/or companies enjoying a strong competitive position within their industry, with an experienced management team
5 / 6
the Company will seek to acquire one or several target businesses and/or companies able to generate or regenerate revenues without being overwhelmed by development costs for new production means and capacities
6 / 6
the Company will seek to acquire one or several target businesses and/or companies offering development potential and complementarity with other businesses deemed to become part of the group that the Company intends to create after the completion of the Initial Business Combination
Though such criteria and guidelines will be used in order to assess each target, the Company will retain the flexibility to complete the Initial Business Combination with one or several target businesses and/or companies that do(es) not meet one or more of such criteria and guidelines provided any such target is considered attractive.
The Company believes that the current macroeconomic trends create a favorable climate for potential Business Combinations in the traditional and digital media content and entertainment industries in Europe. On the back of lower interest rates and oil prices as well as the euro devaluation, the gross domestic product (GDP) in the Eurozone started to grow again in the recent years, with a rate of 0.2% in 2013 and 1.4% in 2014, and is forecast to grow by 1.6% in 2015, rising to 1.8% in 2016 and 1.9% in 2017 (Source: Eurostat, European Commission). The recovery in the European economy has translated into a significant growth in European advertising spending, one of the key economic indicators in the media sector, with an expected compound annual growth rate (CAGR) equal to 5.2% over 2013-2018. (source: McKinsey Global media report 2014 (Western Europe + Central & Eastern Europe))
In addition, the digital revolution, based on the transition from traditional to digital media, creates opportunities. Digitization has enhanced the emergence of new consumption behaviors and business models driving long-term growth within the content media space. Digital media is one of the fastest economic sectors and is expected to significantly outpace GDP growth. As an illustration, the digital media aggregate spending is expected to grow significantly, with an expected CAGR of 15.4% over 2012-2018. (source: McKinsey Global media report 2014 (Western Europe + Central & Eastern Europe))
From a financial market perspective, a strong outperformance of European media stocks was observed over the past few years on the back of solid earnings growth, demonstrating a strong resilience and recognition of the new business models in the media sector. Additionally, the sharper increase in valuation of U.S. media businesses compared to European companies provides significant avenue for growth for players within the European media content and entertainment industry.
According to the Founders, the convergence in the media and entertainment industries is leading to a consolidation of existing actors enabling them to combine their complementary activities. The Founders believe that by implementing a “3C” strategy (standing for “convergence,” “consolidation” and “complementary”), the Company will maximize shareholders’ value by leading the transformation in European media.
The digital revolution and growing mobile consumption create opportunities
The advent of smartphones and tablets has substantially improved the mobile broadband experience, contributing greatly to the surge in mobile broadband penetration. Media access through mobile devices is the fastest-growing sector of global media spending and is expected to become the principal digital platform in the next decade.
New consumption behaviors and business models have emerged
Over the last few years, content consumption habit has rapidly been changing from physical acquisitions and download services to subscription and streaming models. For instance, in the recorded music industry, consumers are not only buying less music in physical formats, but they are also cutting back on digital downloads, shifting their spending to streaming subscriptions and increasing their usage of both ad-supported and paid streaming services which has enabled the emergence of companies such as Spotify or Deezer in Europe.
Convergence of content and platforms leads to an increased competition among industry players.
The increasing demand for media content, accessible “anytime, anywhere” and the increasing amount of data and digital signal processing and delivery have led to a proliferation of distribution platforms in a competitive environment for which content quality and exclusivity remain key differentiating factors. Today, actors from the technology, telecommunication and media sectors are competing to reach consumers using the best content, the best user experience and the best distribution platform.
The growing fragmentation of audience increases the need for consolidation around strong media brands.
Over the last few years, the traditional and digital media content and entertainment industries have experienced significant fragmentation of audiences due to a fast-expanding array and diversity of new media products, channels and platforms. For instance, in the television broadcasting and production sectors, linear TV broadcasters have been increasingly challenged by over-the-top (OTT) platforms such as Netflix, with a growing demand from consumers for more sophisticated and quality content as well as non-linear consumption.
Undervalued opportunities and significant growth potential exist in the traditional and digital media content and entertainment industries.
Vertical integration and effects of scale enable businesses to increase their in-market visibility, expand their content catalogue and diversify their distribution capabilities through different and complementary platforms (television, internet, radio, press and magazines), thus enhancing new value creation within the media and entertainment industries.
Industry players must reach a critical scale to be in a position to develop and distribute content across various platforms.
Digital revolution and disruption of established media business models create attractive opportunities. Although valuations for some media subsectors have increased in the recent years, some have also been negatively impacted, creating value opportunities.
The presence of legacy shareholders in media companies
The presence of legacy shareholders in media companies, willing to either dispose or transfer their assets or their stakes provide further opportunities for the Founders and the Company within the European media content and entertainment industries.
The consolidation of existing actors in the traditional and digital media content and entertainment industries enables them to maximize new value creation through synergistic combinations of brands, medium and content. The fragmentation of audiences has led media companies to develop and use increasingly sophisticated technologies to reach targeted market audiences. These audiences can be reached by leveraging simultaneously complementary content, distribution and technologies. These synergistic combinations have increased the emergence of global media groups which use holistic and complementary skills.
24 months from the listing date
An amount corresponding to 100% of the funds are placed in a secured deposit account until the completion of the Initial Business Combination (IBC)
An amount of €1,000,000 (plus the interests matured on the funds placed in the secured deposit account) represent working capital availability to finance the target research
The funds in the secured deposit account may be invested in financial or money market instruments and/or securities if being specified that in such case the invested capital will be fully guaranteed.
As soon as a binding agreement is entered into by the Company concerning a proposed IBC and in any event no later than the date when the special meeting of Market Shareholders is convened to approve such IBC, the Company will issue a press release relating to such proposed IBC.
The Company management prepares all the documentation for the shareholders’ approval.
The Initial Business Combination is subject to the approval of the shareholders (excluding founders)1. The target company / assets and the Initial Business Combination are presented to Shareholders
1. Founders cannot vote relatively to the Founding Shares
Approved if 2/3 of the Shareholders (excluding the Founders) vote in favour.
The proposed Initial Business Combination is turned down if (I) over 1/3 of the Shareholders (excluding the Founders) vote against it or (II) the Company has not sufficient resources to pay the consideration for the Initial Business Combination and the redemption price of the Market Shares held by Dissenting Market Shareholders to be redeemed by the Company in accordance with its Articles of Association.
The company may, until the expiration of the term (24 months) continue to seek other potential target businesses and/or companies that meet the criteria and guidelines previously described.
back to step
Process of de-SPACing: it becomes an operational company. Dissenting Market Shareholders will be redeemed at a price equal to 100% of the Unit offering price, subject to the conditions set forth in the Company’s Articles of Association for such redemption being met.
Automatic liquidation if it fails to complete the acquisition at the expiration of the term (24 months). The outstanding balance of the deposit account is distributed pursuant to an order of priority among Market Shareholders and Founders.
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