Securities Note

Transcription

Securities Note

Deezer S.A.
A limited liability company (société anonyme) incorporated and organized under the laws of France
with a share capital of €128,535.25 divided into 12,853,525 shares with a nominal value of €0.01 each
and with registered offices at 12, rue d’Athènes, 75009 Paris, France
Securities Note
This securities note (the “Securities Note”) is published in connection with the admission to listing and trading on the regulated market of
Euronext Paris (“Euronext Paris”) on October 29, 2015 of (i) up to 16,053,559 existing shares of Deezer S.A. (the “Company”) with a
nominal value of €0.01 per share (including shares that may be issued upon exercise of certain warrants as further described therein) (the
“Existing Deezer Shares”) and (ii) up to 8,241,758 new shares (on the basis of the lower end of the indicative offering price range) to be issued
by the Company (the “New Deezer Shares”, and together with the Existing Deezer Shares, the “Deezer Shares”).
The offering will include (i) an international offering (the “International Offering”), primarily to institutional investors inside and outside of
France, and a public offering to retail investors in France (the “French Public Offering”, and together with the International Offering, the
“Offering”) of €300 million (including issuance premium) (representing up to 8,241,758 New Deezer shares on the basis of the lower end of the
indicative offering price range); and (ii) the Offering of up to 1,236,264 Existing Deezer Shares (the “Sale Shares” and together with the New
Deezer Shares, the “Offer Shares”) sold by certain selling shareholders in the event of the exercise in full of the over-allotment option (the
“Over-Allotment Option”).
Duration of the French Public Offering: October 15, 2015 to October 26, 2015 (inclusive)
Duration of the International Offering: : October 15, 2015 to October 27, 2015 (inclusive)
Indicative offering price range: €36.40 to €49.24 per share
The price of the French Public Offering and of the International Offering may be set at a price below €36.40 per share. In the event of any
modification to the high end of the indicative offering price range of the French Public Offering and of the International Offering, or if the price
is set above €49.24 per share, orders issued under the French Public Offering may be revoked for a minimum of two trading days.
Pursuant to Articles L. 412-1 et L. 621-8 of the Monetary and Financial Code and to its General Regulation, in particular Articles 211-1 to 2161, the Autorité des Marchés Financiers (AMF) affixed the visa n°15-528 on October 14, 2015 on this Prospectus. This Prospectus was prepared
by Deezer S.A., whose respective signatories take responsibility for it.
Pursuant to Article L. 621-8-1-I of the Monetary and Financial Code, this visa was granted after the AMF verified that the Prospectus is
exhaustive and comprehensible and that the information contained in it is consistent. It does not imply that the AMF has approved the
appropriateness of the transaction or authenticated the accounting and financial information presented herein.
The prospectus (the “Prospectus”) approved by the AMF is composed of:
•
the Registration Document registered by the AMF on September 21, 2015 under number I.15-068;
•
this Securities Note; and
•
the summary in French of the Prospectus (included in this Securities Note).
Copies of the Prospectus and any supplement thereto may be obtained free of charge from the Company’s registered office (12, rue d’Athènes,
75009 Paris, France) on the Company’s website (www.info-deezer.com), as well as on the AMF’s website (www.amf-france.org).
Joint Global Coordinators
BNP PARIBAS
BofA Merrill Lynch
Joint Bookrunners
CITIGROUP
Société Générale
Corporate & Investment Banking
PRELIMINARY NOTE
The Prospectus has been prepared for the purpose of the listing and admission to trading on the regulated market of
Euronext Paris of (i) all of the 16,053,559 Existing Deezer Shares, and (ii) up to 8,241,758 New Deezer Shares.
The Existing Deezer Shares include shares that may be issued upon exercise of all outstanding warrants on or prior
to the settlement date of the Offering (other than the Warrants07/09 held by Mr. Marc Oiknine, which the Company
does not expect to be exercised on or prior to the settlement date of the Offering), based on the lower end of the
indicative offering price range. This Securities Note relates solely to the offering of Offer Shares in France and
may not be relied upon for any purpose by any potential investors outside of France. The International Offering
outside of France will occur solely pursuant to a separate international offering memorandum.
In the Prospectus:
•
“Company” and “Deezer S.A.” mean Deezer S.A., the issuer of the New Deezer Shares and the
Existing Deezer Shares to be listed on Euronext Paris and the parent company of the Group.
•
“Deezer” and the “Group” mean Deezer S.A. and its consolidated subsidiaries.
Forward-looking statements
This Prospectus contains statements regarding the prospects and growth strategies of the Group. These statements
are sometimes identified by the use of the future or conditional tense, or by the use of forward-looking terms such
as “considers”, “envisages”, “believes”, “aims”, “expects”, “intends”, “should”, “anticipates”, “estimates”,
“thinks”, “wishes” and “might”, or, if applicable, the negative form of such terms and similar expressions or
similar terminology. Such information is not historical in nature and should not be interpreted as a guarantee of
future performance. Such information is based on data, assumptions, and estimates that the Group considers
reasonable. Such information is subject to change or modification based on uncertainties in the economic,
financial, competitive or regulatory environments. This information is contained in several chapters of the
Prospectus and includes statements relating to the Group’s intentions, estimates and targets with respect to its
markets, strategies, growth, results of operations, financial situation and liquidity. The Group’s forward-looking
statements speak only as of the date of this Prospectus. Absent any applicable legal or regulatory requirements, the
Group expressly disclaims any obligation to release any updates to any forward-looking statements contained in
this Prospectus to reflect any change in its expectations or any change in events, conditions or circumstances, on
which any forward-looking statement contained in this Prospectus is based. The Group operates in a competitive
and rapidly evolving environment; it is therefore unable to anticipate all risks, uncertainties or other factors that
may affect its business, their potential impact on its business or the extent to which the occurrence of a risk or
combination of risks could have significantly different results from those set out in any forward-looking
statements, it being noted that such forward-looking statements do not constitute a guarantee of actual results.
Information on the Market and Competitive Environment
This Prospectus contains, in particular in Chapter 6, “Business Overview” of the Registration Document,
information relating to the Group’s markets and to its competitive position. Some of this information comes from
research conducted by outside sources, including a Deezer-commissioned study conducted by Enders Analysis
Limited. The Company believes that the information contained herein in relation to the Group’s markets and
competitive position is reliable, but the information has not been verified by an independent expert, and the
Company cannot guarantee that a third party using different methods to collect, analyze or compute market data
would arrive at the same results. Unless otherwise indicated, the information contained in this Registration
i
Document related to market shares and the size of relevant markets are the Group’s estimates and are provided for
illustrative purposes only.
Risk Factors
Investors should carefully consider the risk factors in Chapter 4, “Risk Factors”, of the Registration Document and
in Section 2, “Risk Factors Relating to the Admission of the Deezer Shares to Trading on the Regulated Market of
Euronext Paris”, of this Securities Note. The occurrence of all or any of these risks could have an adverse effect on
the Group’s business, reputation, results of operation, financial condition or prospects. Furthermore, additional
risks that have not yet been identified or that are not considered material by the Group at the date of the visa on this
Prospectus could produce adverse effects.
ii
TABLE OF CONTENTS
Section
Page
RESUME DU PROSPECTUS ........................................................................................................................... 1
SUMMARY ......................................................................................................................................................24
1
2
Persons Responsible for the Prospectus ....................................................................................................44
1.1
Person Responsible ...............................................................................................................44
1.2
Attestation by the Person Responsible ..................................................................................44
1.3
Name and Position of the Person Responsible for Financial Information .............................44
Risk Factors Relating to the Admission of the Deezer Shares to Trading on the Regulated Market of
Euronext Paris ...........................................................................................................................................45
2.1
An active trading market for the Company’s Shares may not develop. ................................45
2.2
The Company’s principal shareholder will continue to hold a significant portion of the
Company’s share capital following the Offering....................................................................................45
2.3
The market price of the Company’s Shares may be volatile. ................................................45
2.4
The underwriting agreement relating to the Offering may not be executed or may be
terminated in certain circumstances. ......................................................................................................46
2.5
The sale by the Company or the Selling Shareholders of a significant number of the
Company’s shares as from the end of the applicable lock-up period or the possibility of such sales may
adversely affect the Company’s share price ...........................................................................................46
2.6
Investors may not receive dividends, as provided for in the Group’s dividend policy. .........47
2.7
The Company’s shares may fall within the scope of the French financial transactions tax and
could be subject to the European financial transactions tax. ..................................................................47
3
4
Key Information ........................................................................................................................................49
3.1
Statement on the Net Working Capital ..................................................................................49
3.2
Capitalization and Indebtedness ............................................................................................49
3.3
Interests of Natural and Legal Persons Participating in the Offering ....................................50
3.4
Reasons for the Offering and Use of Proceeds ......................................................................51
Information on the Shares to be Offered and Listed for Trading ..............................................................51
4.1
Type, class and dividend rights of shares to be offered and listed for trading .......................51
4.2
Applicable law and jurisdiction.............................................................................................52
4.3
Form and Registration of the Deezer Shares .........................................................................52
4.4
Currency of the Shares ..........................................................................................................53
4.5
Rights Attached to the Shares................................................................................................53
4.6
Authorizations .......................................................................................................................55
4.7
Expected Issue Date and Settlement Date .............................................................................59
4.8
Restrictions on the Free Transferability of the Shares ...........................................................59
4.9
French Regulations Relating to Public Offer ........................................................................60
iii
4.10
Takeover Bid for Deezer S.A. Initiated by Third Parties during the Prior or Current
Financial Year.........................................................................................................................................60
4.11
5
Withholding Taxes and Other Taxes Applicable to the Shares ..............................................60
Terms and Conditions of the Offering.......................................................................................................65
5.1
Conditions, Offering Statistics, Indicative Timetable and application procedure for the
Offering ...............................................................................................................................................65
6
7
5.2
Plan of distribution and allotment .........................................................................................72
5.3
Pricing ...................................................................................................................................76
5.4
Placement and Underwriting .................................................................................................80
Admission to Trading and Dealing Arrangements ....................................................................................83
6.1
Admission to Trading ............................................................................................................83
6.2
Other Stock Exchanges .........................................................................................................83
6.3
Simultaneous Offerings of Shares .........................................................................................83
6.4
Liquidity Agreement covering Deezer Shares .......................................................................83
6.5
Stabilization ..........................................................................................................................83
Selling Shareholder ...................................................................................................................................85
7.1
Identification of Selling Shareholders ...................................................................................85
7.2
Number and Class of Securities offered by the Selling Shareholders ...................................85
7.3
Lock-up Agreements .............................................................................................................85
8
Expenses Related to the Offering ..............................................................................................................87
9
Dilution .....................................................................................................................................................88
10
11
9.1
Impact of the Offering on the Proportion of Equity Held by a Shareholder..........................88
9.2
Amount and Percentage of Dilution Resulting Immediately from the Offering....................88
9.3
Allocation of Share Capital and Voting Rights .....................................................................88
Additional Information .............................................................................................................................91
10.1
Advisers with an Interest in the Offering ..............................................................................91
10.2
Other Information verified by the Statutory Auditors ...........................................................91
10.3
Expert’s Report......................................................................................................................91
10.4
Information sourced from Third Parties ................................................................................91
Update of the Registration Document .......................................................................................................92
11.1
RISKS RELATED TO DEEZER’S BUSINESS AND INDUSTRY .....................................92
11.2
DESCRIPTION OF DEEZER’S BUSINESS .......................................................................92
11.3
SUBSCRIBED SHARE CAPITAL AND AUTHORIZED BUT UNISSUED SHARE
CAPITAL ...............................................................................................................................................93
11.4
COMPOSITION OF THE COMMITTEES OF THE BOARD OF DIRECTORS ...............94
11.5
STATEMENT RELATING TO CORPORATE GOVERNANCE .........................................94
11.6
BENEFITS OF SENIOR EXECUTIVES .............................................................................95
iv
11.7
OTHER RELATED PARTY AGREEMENTS ......................................................................95
11.8
STOCK OPTIONS ................................................................................................................95
11.9
CONCORDANCE TABLE ...................................................................................................95
v
RESUME DU PROSPECTUS
Visa n°15-528 en date du 14 octobre 2015 de l’AMF
Le résumé se compose d’une série d’informations clés, désignées sous le terme d’ « Éléments », qui sont présentés
en cinq sections A à E (numérotées de A.1 à E.7).
Ce résumé contient l’ensemble des Éléments devant figurer dans le résumé d’un prospectus relatif à cette catégorie
de valeurs mobilières et à ce type d’émetteur. Tous les éléments ne devant pas être renseignés, la numérotation des
Éléments dans le présent résumé n’est pas continue.
Il est possible qu’aucune information pertinente ne puisse être fournie au sujet d’un Élément donné qui doit figurer
dans le présent résumé du fait de la catégorie des valeurs mobilières et du type d’émetteur concerné. Dans ce cas,
une description sommaire de l’Élément concerné figure dans le résumé avec la mention « Sans objet ».
Section A – Introduction et avertissements
A.1
Avertissement au
lecteur
Ce résumé doit être lu comme une introduction au Prospectus et est fourni dans le
but d’assister les investisseurs qui envisagent d’investir dans les valeurs mobilières
de Deezer, mais il ne constitue pas un substitut au Prospectus.
Toute décision d’investir dans les valeurs mobilières qui font l’objet de l’offre au
public ou dont l’admission aux négociations sur un marché réglementé est
demandée doit être fondée sur un examen exhaustif du Prospectus par
l’investisseur.
Lorsqu’une action concernant l’information contenue dans le Prospectus est
intentée devant un tribunal, l’investisseur plaignant peut, selon la législation
nationale des États membres de l’Union européenne ou parties à l’accord sur
l’Espace Économique Européen, avoir à supporter les frais de traduction du
Prospectus avant le début de la procédure judiciaire.
Les personnes qui ont présenté le résumé, y compris le cas échéant sa traduction et
en ont demandé la notification au sens de l’article 212-41 du Règlement général de
l’AMF, n’engagent leur responsabilité civile que si le contenu du résumé est
trompeur, inexact ou contradictoire par rapport aux autres parties du Prospectus ou
s’il ne fournit pas, lu en combinaison avec les autres parties du Prospectus, les
informations clés permettant d’aider les investisseurs lorsqu’ils envisagent
d’investir dans les Actions Offertes (tel que ce terme est défini ci-après).
A.2
Consentement de
la Société
Sans objet.
1
Section B – Société
B.1
B.2
B.3
Raison sociale
et nom
commercial
Raison sociale : Deezer S.A. (la « Société » et, avec ses filiales consolidées prises dans
leur ensemble, « Deezer » ou le « Groupe »).
Nom commercial : Deezer
Siège social /
Forme
juridique /
Droit
applicable /
Pays
d’origine
Siège social : 12, rue d’Athènes, 75009 Paris
Nature des
opérations et
principales
activités
Le Groupe Deezer est un leader mondial du streaming audio à la demande, offrant à des
millions d’abonnés l’accès à un catalogue de plus de 35 millions de titres musicaux et
40 000 podcasts d’information, de divertissement et de sport. Les utilisateurs de Deezer
peuvent écouter des playlists personnalisées ainsi que des radios à partir de tout appareil
connecté à internet, en ce compris les ordinateurs portables, tablettes, smartphones,
smart TVs et systèmes audio sans fil. Le catalogue audio de Deezer est disponible dans
plus de 180 pays.
Forme juridique : Société anonyme
Droit applicable : Droit français
Pays d’origine : France
Le chiffre d’affaires de Deezer se compose principalement des abonnements, payés soit
directement à Deezer soit indirectement par l’intermédiaire de ses partenaires. Son
chiffre d’affaires dépend principalement du nombre d’abonnés et du type d’abonnés par
catégorie (les abonnés standalone représentent 45,6 % du chiffre d’affaires consolidé du
Groupe pour l’exercice 2014 et les abonnés bundle 49,5 %). Deezer perçoit également
des recettes provenant de la vente d’espaces publicitaires sur sa plateforme (tels que les
publicités audio avant la lecture d’une piste, les bannières et autres affichages
interstitiels ou vidéos) (3,8 % du chiffre d’affaires consolidé du Groupe pour l’exercice
2014). La majorité des coûts de Deezer est constituée des royalties payées aux ayants
droits (79,3 % du chiffre d’affaires consolidé du Groupe pour l’exercice 2014). Deezer
supporte également des coûts de développement de produits, de marketing et autres
frais généraux.
Au 31 décembre 2014, Deezer comptait 6,9 millions d’abonnés au total dont 1,3
millions d’abonnés standalone (qui payent un montant spécifique pour leur
abonnement à Deezer) et 1,6 millions d’abonnés bundle (qui bénéficient d’un
abonnement à Deezer inclus dans leur forfait téléphonique). Parmi les abonnés bundle,
1,6 millions ont été actifs au cours du mois de décembre 2014 (ayant écouté au moins
30 secondes d’un morceau de musique). La base d’abonnés standalone et bundle actifs
a augmenté de 39,2% en 2014, et de 4,5% au cours du premier semestre 2015.
Les activités de Deezer sont réparties en cinq segments géographiques : France, Europe,
Amérique latine, Etats-Unis et le Reste du monde. La France constitue le segment le
plus large, avec une activité suffisamment développée pour être rentable. Les activités
de Deezer dans les autres secteurs sont récentes et croissent très rapidement, mais n’ont
pas encore atteint la rentabilité opérationnelle.
Le chiffre d’affaires consolidé du groupe a augmenté significativement au cours des
trois dernières années, de 63,6 millions d’euros en 2012, à 92,8 millions d’euros en
2013, et à 141,9 millions en 2014. Le chiffre d’affaires du premier semestre 2015 s’est
élevé à 93,2 millions d’euros, représentant une augmentation de 40,9% par rapport à la
même période en 2014. Cette croissance rapide du chiffre d’affaires a été
principalement portée par l’augmentation significative de la base d’abonnés générateurs
2
de revenus de Deezer, qui a plus que doublé depuis la fin de l’année 2012.
Cette croissance importante du chiffre d’affaires s’est traduite par une augmentation
similaire de la marge brute (qui est égale au chiffre d’affaires diminué des royalties et
autres coûts des ventes). Le taux de marge brute représentait 15,6% du chiffre d’affaires
en 2014, et 17,7% du chiffre d’affaires du premier semestre 2015. Deezer s’attend à une
croissance du taux de marge brute, étant donné que l’activité est en croissance, et se
concentre davantage sur les abonnés standalone que bundle.
Deezer n’a pas encore dégagé de résultat d’exploitation, d’EBITDA ou de résultat net
positifs, reflétant son statut de jeune société ayant massivement investi dans sa
technologie, son développement international et la croissance de sa base d’utilisateurs.
Deezer a enregistré un EBITDA positif en France (calculé comme la contribution à la
marge de la France diminuée des frais de siège répartis égalitairement entre les cinq
segments géographiques) au cours de chacune des trois dernières années et durant le
premier semestre 2015, et son objectif est de faire de même sur ses nouveaux marchés
dans les années à venir.
B.4a
Principales
tendances
récentes
ayant des
répercussions sur la
Société et ses
secteurs
d’activité
Voir la section B.7 ci-dessous pour une présentation des informations financières clés
historiques pour le semestre clos le 30 juin 2015.
Perspectives d’avenir à moyen terme
Deezer considère qu’avec des investissements limités, la Société a été capable
d’acquérir une position forte en terme de qualité de ses services, sa présence
géographique, son catalogue, et ses relations bien établies avec des partenaires
stratégiques clés de distribution ainsi qu’avec les ayants droits des contenus audios
qu’elle diffuse. Le marché du streaming (audio) par abonnement (comprenant les
revenus des abonnements payants et de la publicité des services de streaming à
l’abonnement) est destiné à devenir le plus grand canal de distribution de la musique
pour les années à venir. Deezer a l’intention d’augmenter significativement ses
investissements dans des initiatives marketing et stratégiques clées dans les trois
prochaines années afin de tirer profit ces perspectives prometteuses du marché de
streaming (audio), afin d’accélérer la croissance de ses revenus, et d’atteindre un
EBITDA et un flux de trésorerie mensuels positifs d’ici la fin de l’année 2018.
Objectifs de chiffre d’affaires
Deezer a pour objectif d’atteindre un chiffre d’affaires de plus de 750 millions d’euros
en 2018. En 2014, Deezer a enregistré un chiffre d’affaires de 141,9 millions d’euros.
Les revenus de Deezer ont augmenté de 37% en juillet et août 2015 par rapport à juillet
et août 2014, et devraient augmenter de plus de 35% en 2015 comparé à 2014.
Deezer cherchera à accélérer la croissance de son chiffre d’affaires par une
augmentation significative des investissements marketing et l’acquisition de nouveaux
abonnés, la poursuite de l’innovation produit afin d’augmenter la qualité du service
proposé aux utilisateurs, ce qui devrait continuer à favoriser une forte croissance du
chiffre d’affaires, particulièrement en 2017 et 2018. Deezer considère que la croissance
de son chiffre d’affaires sera essentiellement portée par les abonnements standalone.
Deezer prévoit que les abonnements standalone représenteront la majeure partie de ses
revenus dans les prochaines années, particulièrement au sein de ses marchés développés
tels que la France et le reste de l’Europe.
Objectifs d’ EBITDA
Deezer a pour objectif d’atteindre un EBITDA et un flux de trésorerie mensuels positifs
d’ici à fin 2018, contre une perte d’EBITDA de 21,0 millions d’euros et une variation
3
nette de trésorerie de (4,7) millions d’euros pour l’exercice clôturé au 31 décembre
2014. Deezer a déjà atteint un EBITDA positif en France ces trois dernières années et
durant le premier semestre 2015, et son objectif est de faire de même sur ses autres
marchés dans les années à venir.
Deezer a l’intention de mettre en œuvre de nombreuses initiatives marketing et
stratégiques pouvant à court terme entraîner une baisse significative de l’EBITDA,
particulièrement en 2016 et 2017, où Deezer prévoit d’augmenter significativement ses
investissements marketing et commerciaux par rapport aux années précédentes. D’ici à
la fin 2018, Deezer prévoit une réduction des investissements marketing en pourcentage
de chiffre d’affaires.
Les données, hypothèses et estimations présentées ci-dessus sont susceptibles d’évoluer
ou d’être modifiées en raison des incertitude liées notamment à l’environnement
économique financier, concurrentiel, réglementaire et fiscal ou en fonction d’autres
facteurs dont le Groupe n’avait pas connaissance à la date du Document de Base
enregistré par l’AMF sous le numéro I.15-068 le 21 septembre 2015, soit à la date du
présent Prospectus. En outre, la matérialisation de certains risques décrits au Chapitre
4 « Risk Factors » du Document de Base pourrait avoir un impact sur les activités, la
situation financière, les résultats ou les perspectives de Deezer et donc remettre en
cause sa capacité à réaliser les objectifs présentés ci-dessus. Par ailleurs, la réalisation
des objectifs suppose le succès de la stratégie de Deezer présentée au Chapitre 6.3 «
Strategy » du Document de Base. Deezer ne prend donc aucun engagement ni ne donne
aucune garantie quant à la réalisation des objectifs figurant ci-dessus et ne s’engage
pas à publier ou à communiquer d’éventuels rectificatifs ou mises à jour de ces
éléments.
B.5
Groupe
auquel
la
Société
appartient
L’organigramme suivant décrit la strucuture juridique du Goupe à la date du présent
Prospectus:
Deezer S.A.
(France)
Calypsound SAS
(France)
Musica Illimitada
SA DE CV
(Mexique)
Deezer Inc.
(USA)
4
Deezer Music
Brasil LTDA
(Brésil)
Deezer Singapore
PTE LTD
(Singapour)
Magik Internet
Musik GmbH
(Allemagne)
Deezer UK –
Branch
(Royaume-Uni)
Deezer Germany
– Branch
(Allemagne)
B.6
Principaux
actionnaires
Une fois la division du nominal des actions décidée par l’assemblée générale
extraordinaire des actionnaires du 9 octobre 2015 (la « Division du Nominal »), et dans
l’hypothèse où (i) toutes les catégories d’actions ont été converties en actions
ordinaires 1 , et (ii) tous les BSA en circulation ont été exercés au moment ou
préalablement à la réalisation de l’Offre (à l’exclusion des BSA07/09 détenus par
Monsieur Marc Oiknine, dont la Société n’anticipe pas l’exercice au moment ou
préalablement à la réalisation de l’Offre), le capital social non dilué de la Société avant
la date de clôture de l’Offre sera égal à 160 535,59 euros, divisé en 16 053 559 actions,
d’une valeur nominale de 0,01 euro, totalement souscrites et intégralement libérées,
réparties comme suit :
Les tableaux ci-dessous ne reflètent pas les actions sous-jacentes aux stock-options
détenus par certains dirigeants et salariés de la Société et aux BSA detenus par M. Marc
Oiknine.
Actionnaires
Jonathan Benassaya
Daniel Marhely
Thomas Erhel
Xavier Niel
DC Music Sàrl (1)
Idinvest Partners
CM-CIC Capital Privé
Orange Participations
Access Industries(2)
MIH(4)
Warner
Sony
EMI
Universal
Didier Bench
Anciens employés
Total
________
Nombre d’actions
% du capital (non-dilués)
110 403
1 344 092
104 052
643 539
1 669 472
1 649 143
676 280
1 870 906
4 763 830(3)
439 669(5)
664 680
664 680
332 311
1 032 052
66 700
21 750
16 053 559(6)
0,7%
8,4%
0,6%
4,0%
10,4%
10,3%
4,2%
11,7%
29,7%
2,7%
4,1%
4,1%
2,1%
6,4%
0,4%
0,1%
100%
(1) DC Music Sàrl est le véhicule d’investissement dédié du fonds Dotcorp Private Equity Fund
III des frères Rosenblum (fondateurs de la société d’e-commerce, Pixmania).
(2) L’actionnaire direct d’Access Industries est Al European Holding Sàrl dont le bénéficiaire
effectif est M. Len Blavatnik.
(3) Ce tableau reflète (i) l’exercice par M. Simon Baldeyrou, à la date de détermination du Prix de
l’Offre de son option d’achat lui donnant le droit d’acquérir 43 500 actions de plusieurs
actionnaires (cette option d’achat n’ayant pas d’impact dilutif), et (ii) la cession de ces 43 500
actions par M. Simon Baldeyrou à Access Industries à un prix correspondant au Prix de l’Offre,
au jour de la détermination du Prix de l’Offre.
(4) MIH est une filiale de Prosiebensat.1 Media AG
(5) Ce chiffre reflète le nombre de BSA exerçables par MIH sur la base de la borne inférieure de
la fourchette indicative de prix.
1
A la date de détermination du Prix de l’Offre (le 27 octobre 2015 selon le calendrier indicatif), conformément aux
dispositions de l’article 10.2.1 des statuts actuels de la Société, les actions de préférence de catégorie A ( les
« Actions A ») et les actions de préférence de catégorie B (les « Actions B ») seront automatiquement converties en
actions ordinaires, et (a) le ratio de conversion applicable aux Actions A est soit (i) une action ordinaire pour une
Action A si le Prix de l’Offre par action est plus élevé qu’un montant correspondant au prix d’émission des Actions
A (augmenté d’un rendement minimum sur la période de détention), soit (ii) supérieur à une action ordinaire pour
une Action A si le Prix de l’Offre par action est inférieur à un tel montant ; et (b) le ratio de conversion applicable
aux Actions B est une action ordinaire pour une Action B dans tous les cas. Dans la mesure où le Prix de l’Offre est
supérieur au montant correspondant au prix d’émission des Actions A (augmenté d’un rendement minimum sur la
période de détention), le ratio de conversion des Actions A sera une action ordinaire pour une Action A.
5
(6) Inclut 3.200.034 actions nouvelles émises à la suite de l’exercice envisagé de 1.919.133 BSA
(au moment ou préalablement à la réalisation de l’Offre) par les titulaires concernés (lesquels
expireraient à la date de ladite réalisation). A la date du présent Prospectus, la Société a reçu une
notification de la part des titulaires de 1.570.553 BSA eu égard à leur exercice, sous réserve d’une
réalisation avant le 31 décembre 2015. Le produit consolidé afférent à l’exercice de l’ensemble de
ces BSA sur la base de leurs prix d’exercice et d’autres modalités applicables serait d’environ 12
millions d’euros. Il est prévu que les BSA détenus par Sony seront exercés dans la mesure où le
prix moyen d’exercice de ces BSA Sony est de 7,9 euros.
Dans l’hypothèse où l’ensemble des stock-options et des BSA en circulation sont
exercés avant la réalisation de l’Offre, le nombre total d’actions ordinaires en
circulation serait de 17 120 179 actions (24,9 % du capital social de la Société à la date
du présent Prospectus).
A l’issue de l’Offre, et après l’émission d’un nombre maximum de 8 241 758 Actions
Deezer Nouvelles sur la base de la borne inférieure de la fourchette indicative de prix,
l’actionnariat de la Société ressortirait comme suit :
Actionnaires
Actionnariat (hors
exercice éventuel de
l’Option de Surallocation)
Nombre
d’actions
Jonathan Benassaya
Daniel Marhely
Thomas Erhel
Xavier Niel
DC Music Sàrl
Idinvest Partners
Access Industries
MIH
Warner
Sony
EMI
Universal
Didier Bench
Public
Total
110 403
1 344 092
104 052
643 539
1 669 472
1 649 143
676 280
1 870 906
4 763 830
439 669
664 680
664 680
332 311
1 032 052
66 700
8 263 508
24 295 317
% du
capital
0,5%
5,5%
0,4%
2,6%
6,9%
6,8%
2,8%
7,7%
19,6%
1,8%
2,7%
2,7%
1,4%
4,2%
0,3%
34,0%
100%
Actionnariat (après
exercice intégral de
Nombre
d’actions
110 403
1 071 089
82 918
512 828
1 330 380
1 314 180
538 919
1 870 906
4 763 830
439 669
664 680
664 680
332 311
1 032 052
66 700
9 499 772
24 295 317
% du
capital
0,5%
4,4%
0,3%
2,1%
5,5%
5,4%
2,2%
7,7%
19,6%
1,8%
2,7%
2,7%
1,4%
4,2%
0,3%
39,1%
100%
A l’issue de l’Offre, et après l’émission d’un nombre maximum de 6 092 608 Actions
Deezer Nouvelles sur la base de la borne supérieure de la fourchette indicative de prix,
l’actionnariat de la Société ressortirait comme suit :
Actionnaires
Actionnariat (hors
exercice éventuel de
Nombre
d’actions
Jonathan Benassaya
Daniel Marhely
Thomas Erhel
Xavier Niel
DC Music Sàrl
110 403
1 344 092
104 052
643 539
1 669 472
6
% du
capital
0,5%
6,1%
0,5%
2,9%
7,5%
Actionnariat (après
exercice intégral de
Nombre
d’actions
110 403
1 142 278
88 429
546 913
1 418 803
% du
capital
0.5%
5.2%
0.4%
2.5%
6.4%
Idinvest Partners
Access Industries
MIH
Warner
Sony
EMI
Universal
Didier Bench
Public
Total
1 649 143
676 280
1 870 906
4 763 830
406 174
664 680
664 680
332 311
1 032 052
66 700
6 114 358
22 112 671
7
7,5%
3,1%
8,5%
21,5%
1,8%
3,0%
3,0%
1,5%
4,7%
0,3%
27,7%
100%
1 401 526
574 738
1 870 906
4 763 830
406 174
664 680
664 680
332 311
1 032 052
66 700
7 028 249
22 112 671
6.3%
2.6%
8.5%
21.5%
1.8%
3.0%
3.0%
1.5%
4.7%
0.3%
31.8%
100%
B.7
Informations
financières
historiques
clés
sélectionnées
Les informations financières sélectionnées présentées ci-dessous sont issues des
comptes consolidés de Deezer pour les exercices clos au 31 décembre 2014, 2013 et
2012 (les « Comptes Annuels »), et les comptes consolidés intermédiaires condensés
pour le semestre clos le 30 juin 2015 et 2014 (les « Comptes Semestriels »). Les
Comptes Annuels ont été préparés conformément aux normes IFRS telles qu’adoptées
par l’Union Européenne. Les Comptes Semestriels ont été préparés conformément à la
norme IAS 34, « Information financière intermédiaire », la norme standard IFRS
applicable aux rapports financiers intermédiaires.
Le tableau ci-dessous présente les informations financières sélectionnées de Deezer
pour les périodes clôturées aux dates indiquées ci-dessous.
(en milliers d’euros)
Exercices clos le 31 décembre
2014
Chiffre d’affaires ......... 141,923
(1)
Marge brute ..............
22,130
(2)
EBITDA ................... (20,958)
Perte
nette
d’exploitation(3) ........... (26,974)
2013
2012
92,800
Semestres clos le 30
juin
63,565
2015
93,219
2014
66,137
2,233
5,542
16,531
9,228
(38,507)
(11,147)
(10,981)
(11,152)
(22,514)
(29,132)
(12,196)
(12,741)
Perte de l’exercice ...... (27,175)
(22,059)
(28,846)
(8,969)
(12,819)
____________________
(1) Comprend l’impact des minima garantis relatifs aux contrats de licence entre Deezer
et les maisons de disques. Conformément à certains de ses contrats de licence, Deezer
est tenu de payer aux maisons de disques des minima garantis. Ces minima garantis sont
généralement payés en partie à l’avance et en partie pendant la durée de vie du contrat
de licence. Ils sont déduits du total des royalties dues au titre des contrats. En 2012,
Deezer a conclu des contrats prévoyant des minima garantis qui excédaient le montant
anticipé des royalties que Deezer s’attendait à payer sur la base des usages prévus, ce
qui a impacté négativement la marge brute de Deezer en 2012 et 2013, et dans une
moindre mesure en 2014. Deezer avait alors donné son accord à ces minima garantis
notamment pour soutenir sa stratégie de croissance internationale, l’augmentation des
minima garantis était requise afin d’étendre les contrats de licence Deezer à d’autres
territoires où elle espérait générer une croissance du nombre de ses abonnements et de
ses revenus suffisante pour lui permettre de recouvrer ces minima garantis dans le futur.
La marge brute de Deezer hors impact des minima garantis s’est élevée à 24,1 millions
d’euros, 15,4 millions d’euros et 10,9 millions d’euros sur les exercices clôturés au 31
décembre 2014, 2013 et 2012, respectivement, et 17,1 millions d’euros et 12,5 millions
pour le semestre clos au 30 juin 2015, et 2014, respectivement.
(2) L’EBITDA est égal à la marge brute diminuée des coûts de développement, de
ventes et de marketing ainsi que des frais généraux et d’administration. La définition de
l’EBITDA utilisée par Deezer peut ne pas être comparable à des termes similaires
utilisés par d’autres sociétés.
(3) Comprend la dépréciation, l’amortissement et les provisions relatives aux minima
garantis.
B.8
B.9
B.10
Informations
financières
pro forma clés
sélectionnées
Prévisions ou
estimations de
bénéfice
Réserves sur
les
Sans objet.
Aucun.
Sans objet.
8
informations
financières
historiques
B.11
Fonds de
roulement net
La Sociéte atteste que, de son point de vue, le fonds de roulement net consolidé du
Groupe est suffisant au regard de ses obligations pour les 12 prochains mois à compter
de la date du présent Prospectus, avant augmentation de capital en numéraire objet de la
présente note d’opération.
9
Section C – Valeurs mobilières
C.1
Nature, catégorie
et numéro
d’identification
des actions
offertes et/ou
émises et admises
aux négociations
Détail des actions admises à la cotation :
Les actions dont l’admission aux négociations sur Euronext Paris (compartiment A
ou B) est demandée seront les suivantes :
(i) l’ensemble des 16 053 559 actions existantes de la Société, d’une valeur
nominale de 0,01 euro chacune 1 (incluant les actions ordinaires issues de
l’exercice de tous les BSA (autres que les BSA07/09 détenus par M. Marc
Oiknine)), (les « Actions Deezer Existantes ») ; et
(ii) un maximum de 8 241 758 actions nouvelles à émettre par la Société (les
« Actions Deezer Nouvelles », et avec l’ensemble des Actions Deezer
Existantes, les « Actions Deezer »).
Les Actions Deezer sont toutes de même catégorie et ont la même valeur nominale.
Date de jouissance : Toutes les Actions Deezer sont actuellement éligibles à
recevoir tout dividende distribué par la Société conformément à ses statuts.
Libellé pour les actions : « Deezer »
Code ISIN : FR0013004959
Mnémonique : DZR
Compartiment : Compartiment A ou B
Classification ICB : 5533
C.2
Devise
Euro.
C.3
Nombre
d’actions émises /
Valeur nominale
des actions
Après la Division du Nominal et dans l’hypothèse où (i) toutes les catégories
d’actions ont été converties en actions ordinaires, et (ii) tous les BSA en
circulation ont été exercés au moment ou préalablement à la réalisation de l’Offre
(à l’exclusion des BSA07/09 détenus par Monsieur Marc Oiknine), le capital social
non dilué de la Société serait égal à 160 535,59 euros, divisé en 16 053 559
actions, d’une valeur nominale de 0,01 euro, entièrement souscrites et
intégralement libérées.
Les Actions Nouvelles Deezer à émettre dans le cadre de l’augmentation de capital
avec suppression du droit préférentiel de souscription des actionnaires par voie
d’offre au public d’un montant d’environ 300 millions euros (prime d’émission
incluse), correspondant, à titre indicatif, à 8 241 758 Actions Nouvelles Deezer,
sur la base de la borne inférieure de la fourchette indicative de prix.
Une fois émises, les Actions Nouvelles Deezer seront intégralement souscrites,
entièrement libérées et de même catégorie que les Actions Deezer Existantes.
1
Les actionnaires de la Société ont décidé, lors de l’assemblée générale extraordinaire du 9 octobre la division par 29 du nominal des actions de
la Société passant de 0,29 euro par action à 0,01 euro par action.
10
La valeur nominale par action est de 0,01 euro.
C.4
Droits attachés
aux actions
En l’état actuel de la législation française et des statuts de la Société, les
principaux droits attachés aux Actions Existantes et aux Actions Deezer
Nouvelles, à compter de leur admission aux négociations dans le cadre de l’Offre
sont les suivants :
•
•
•
•
droit à dividende ;
droit de vote ;
droit préférentiel de souscription aux titres de même catégorie ; et
droit de participation à tout boni de liquidation.
Les statuts de la Société, ainsi modifiés et devant entrer en vigueur à compter de
l’admission définitive des actions de la Société aux négociations sur Euronext
Paris, par une dérogation expresse à l’article L. 225-123 alinéa 3 du Code de
Commerce, n’attribuent pas de droit de vote double aux actions de la Société.
C.5
C.6
Restriction
imposée à la libre
négociabilité des
actions
Demande
d’admission à la
négociation
Aucune clause statutaire ne limite la libre négociabilité des actions composant le
capital de la Société.
Une demande a été effectuée aux fins d’admission des Actions Deezer aux
négociations sur le Compartiment A ou B d’Euronext Paris.
Selon le calendrier indicatif, les conditions de négociation des Actions Deezer
seront fixées dans un avis d’Euronext Paris diffusé le 27 octobre 2015.
Selon le calendrier indicatif, la première cotation des Actions Deezer Nouvelles et
des Actions Deezer Existantes sur Euronext Paris est prévue le 27 octobre 2015, et
les négociations sur Euronext Paris (sous la forme de promesses d’actions au sens
de l’article L. 228-10 du Code de commerce), débuteraient le 28 octobre 2015.
A compter du 28 octobre 2015 et jusqu’à la date de règlement-livraison de l’Offre
(incluse) prévue le 29 octobre 2015 (selon le calendrier indicatif), les Actions
Nouvelles Deezer (sous la forme de promesses d’actions au sens de l’article L.
228-10 du Code de commerce) seront négociées sur une ligne de cotation intitulée
« DZR – Promesses » et seront soumises à la condition suspensive de la délivrance
du certificat du dépositaire relatif à l’émission des Actions Deezer Nouvelles.
Dans l’hypothèse où le Contrat de Garantie (tel que ce terme est défini ci-dessous)
ne serait pas signé, l’Offre sera annulée rétroactivement. Dans l’hypothèse où le
Contrat de Garantie serait résilié conformément à ses termes, l’Offre sera annulée
rétroactivement, le certificat du dépositaire des fonds ne sera pas émis à la date de
règlement-livraison de l’Offre et toutes les opérations portant sur les Actions
Deezer intervenues depuis l’admission aux négociations seront annulées
rétroactivement, chaque investisseur individuel faisant son affaire personnelle du
manque à gagner et des coûts résultant d’une telle annulation.
A compter du 30 octobre 2015, les Actions Deezer seront négociées sur une ligne
de cotation intitulée “DZR”.
A la date du présent Prospectus, aucune autre demande d’admission à la
négociation sur un marché réglementé n’a été formulée, ni n’est prévue par la
Société.
C.7
Politique en
matière de
Conformément à la loi et aux statuts de la Société, les Actionnaires de la Société
peuvent lors de l’assemblée générale annuelle, et sur recommandation du Conseil
11
dividendes
d’Administration de la Société, décider la distribution de dividendes.
La politique de distribution de dividendes de la Société prendra en compte les
résultats de la Société, sa situation financière, sa stratégie de croissance, ses
besoins en liquidité, la mise en œuvre de ses objectifs, et tout autre facteur
considéré comme pertinent par le Conseil d’Administration de la Société.
La Société n’a procédé à aucune distribution de dividende depuis sa constitution,
ceci incluant les exercices clos le 31 décembre 2012, 2013 et 2014. La Société
entend actuellement se concentrer sur la croissance et envisage de réinvestir tous
les profits générés dans les activités du Groupe. En conséquence, la Société ne
prévoit pas de payer de dividendes dans un avenir proche.
12
Section D – Risques
D.1
Principaux
risques propres à
la Société ou à
son secteur
d’activité
Les principaux facteurs de risques propres à la Société, au Groupe et à son secteur
d’activité figurent ci-après :
(i) risques relatifs au marché de l’audio et du streaming à la demande :
• L’activité de Deezer dépend de l’augmentation et la poursuite de
l’acceptation du streaming à la demande en tant que format de
distribution de musique ;
• Le marché des services de streaming audio à la demande est nouveau et
évolue rapidement ;
• Deezer intervient dans un environnement hautement compétitif, et des
pressions concurrentielles pourraient affecter ses revenus et sa
croissance ;
• Le marché du streaming audio pourrait ne pas se développer dans certains
marchés importants où il n’est pas encore largement répandu ou pour
lesquels les droits de diffusion ne sont pas disponibles ;
• Des ralentissements économiques sur les marchés au sein desquels
Deezer intervient pourraient affecter la demande puisque les dépenses
relatives aux services de streaming sont discrétionnaires ;
(ii) risques relatifs au contenu :
• Si Deezer ne parvient pas à négocier et à conserver les contrats de licence
avec les ayants droit selon des termes acceptables pour la Société, ou
manque aux obligations qui lui incombent en vertu de ces contrats de
licence, son activité pourrait en être affectée ;
• Si Deezer ne conserve pas ses licences avec les grandes maisons de
disques à des conditions lui étant favorables, ou n’en conserve aucune,
son activité, sa situation financière et ses résultats d’exploitation en
seraient significativement affectés ;
• Certaines licences de contenu sont sujettes à des clauses de « nation la
plus favorisée » ;
• Les royalties versées aux ayants droit représentent la majeure partie du
coût des ventes de Deezer ;
• Les royalties versées aux ayants droit et autres partenariats commerciaux
sont soumis à des droits d’audit et donc sujets à des ajustements
consécutifs à ces audits ;
• Le fournisseurs de contenu de Deezer doivent généralement approuver la
commercialisation de ses offres ;
• Si Deezer ne sécurise pas les licences portant sur du contenu local
populaire dans des marchés géographiques clés, son activité et ses
perspectives de croissance pourraient en être affectées ;
• Les licences de droits d’auteur peuvent être difficiles et coûteuses à
obtenir dans la mesure où les titulaires de droits d’auteur sont souvent
dispersés et fragmentés, et Deezer ne pourrait disposer que
d’ informations limitées sur les titulaires de droits d’auteur et les royalties
associées ;
• Certains des contrats de licence conclus avec les ayants droits
comprennent des minima garantis ;
• Deezer pourrait être dans l’impossibilité d’acquérir des droits de diffusion
de contenus populaires parce-que leurs titulaires refuseraient d’en
octroyer les licences ou ne le feraient qu’à des prix très élevés;
• Si un nombre significatif d’auteurs, compositeurs et/ou artistes refusait
d’être représentés par de plus grandes maisons de disques ou d’édition,
les coûts de transaction de Deezer pourraient considérablement
augmenter, ce qui pourrait avoir un impact négatif sur son activité ;
• Deezer n’a pas de licences directes avec des sociétés de gestion collective
13
•
des droits des artistes interprètes et pourrait être contraint de les acquérir à
l’avenir ;
Les royalties de Deezer versées aux ayant droits pourraient augmenter
significativement dans le cadre de son développement et l’intégration
d’autres catégories de contenu audio ;
(iii) risques relatifs à l’acquisition d’abonnés et au taux de résiliation (churn) :
• Deezer pourrait ne pas parvenir à attirer des utilisateurs vers ses services
d’abonnement payants ;
• Les résultats d’exploitation de Deezer dépendent de sa capacité à établir
et maintenir en des termes favorables des relations avec les partenaires de
distribution qui promeuvent et distribuent les services de Deezer ;
• Deezer pourrait ne pas parvenir à renouveler ses accords de partenariat
avec ses divers partenaires de distribution à l’échéance des contrats, et en
particulier son accord de partenariat avec Orange en France, ou ne
parviendrait pas à le faire à des conditions favorables ;
• L’activité de Deezer pourrait être affectée si la marque, la réputation, et
l’activité de ses partenaires de distribution sont affectées ou si ses
partenaires de distribution ne parviennent pas à distribuer et promouvoir
efficacement les services de Deezer ;
• Les campagnes de marketing et activités promotionnelles de Deezer
pourraient ne pas être rentables ou permettre d’attirer ou conserver les
abonnés, ce qui pourrait affecter significativement sa profitabilité ;
• Si Deezer est confronté à des taux de résiliation (churn) excessifs, ses
revenus et son activité pourraient en être affectés ;
• L’incapacité à anticiper les préférences de contenu des utilisateurs avec
exactitude pourrait avoir un impact sur l’acquisition d’abonnés et les taux
de résiliation ;
• Les activités et les perspectives de Deezer dépendent de la solidité de sa
marque, et l’incapacité à maintenir et améliorer sa marque porterait
atteinte à sa capacité à élargir sa base d’abonnés, de fournisseurs de
contenu et autres partenaires ;
(iv) risques relatifs aux prestataires de services tiers et aux partenaires de
distribution :
• Deezer s’appuie en partie sur des app stores tiers pour distribuer son
application mobile et collecter les abonnements, et des modifications de
leurs contrats de licence, en particulier une augmentation des
commissions facturées par ces intermédiaires, pourraient avoir un effet
négatif sur Deezer ;
• Si la technologie et les systèmes de Deezer deviennent incompatibles
avec les technologies de ses partenaires de distribution, la société pourrait
ne plus être compétitive et son activité pourrait ne pas croître voire
décliner ;
• Deezer s’appuie sur des prestataires de services tiers pour gérer les
serveurs sur son réseau, et pour la fourniture de certains logiciels et
systèmes d’exploitation. Des défaillances, erreurs, ou perturbations dans
ces réseaux, logiciels, et systèmes d’exploitation pourraient porter atteinte
à la réputation et à l’activité de Deezer ;
(v) risques relatifs au plan d’affaires et à la stratégie de Deezer:
• Le plan d’affaires et la stratégie de Deezer sont sujets à modifications ;
• L’incapacité de Deezer à gérer efficacement sa croissance pourrait
affecter ses activités, sa situation financière et ses résultats
d’exploitation ;
• Deezer dépend de certains dirigeants clés et personnes qualifiées, et
l’incapacité à attirer, conserver et motiver des employés qualifiés pourrait
14
•
•
•
•
affecter son activité ;
L’expansion de Deezer vers de nouveaux types de contenu audio et de
nouveaux styles musicaux pourrait ne pas être fructueuse ;
Les activités et la stratégie internationales de Deezer l’exposent à divers
risques économiques, politiques, réglementaires et autres dans plusieurs
Etats ;
L’activité de Deezer dépend de sa capacité à attirer de nouveaux
annonceurs et à conserver les annonceurs existants ;
Deezer pourrait ponctuellement procéder à des acquisitions ;
(vi) risques relatifs aux systèmes de traitement des données et des informations :
• Les préoccupations relatives à la vie privée et la règlementation sur la
protection des données personnelles pourraient limiter la capacité de
Deezer à collecter et monétiser ses données abonnés ;
• Des failles dans la sécurité aboutissant à des accès non autorisés ou à la
divulgation de données d’abonnés pourraient porter atteinte à la
réputation de Deezer et affecter significativement son activité et ses
résultats d’exploitation ;
• D’importantes interruptions dans les services de Deezer dues à des
problèmes rencontrés avec son réseau pourraient conduire à la perte
d’abonnés et d’utilisateurs ;
• Deezer est généralement soumis à des obligations de niveau de service
découlant de ses accords de partenariat, et une perturbation importante
dans ses systèmes informatiques, interface d’utilisateur ou applications
mobiles pourrait conduire à la perte ou à la détérioration du service et
donner lieu à l’engagement de sa responsabilité en vertu des accords de
partenariats ;
• Le logiciel propriétaire et les systèmes de Deezer pourraient être soumis à
d’importantes pressions à mesure que ses activités se développent, et des
retards ou l’incapacité à mettre à niveau les logiciels et les systèmes
efficacement pourraient perturber les activités ou entrainer l’augmentation
des coûts d’exploitation et du passif ;
• La plateforme Deezer est accessible via les réseaux internet et mobiles. Si
les infrastructures propres à ces réseaux stagnent, se détériorent, ou sont
inefficaces ou non-fiables, Deezer pourrait se retrouver dans l’incapacité
de fournir son service aux abonnés ;
• Des changements dans la façon dont les opérateurs prennent en charge et
facturent l’accès aux données qui sont transmisent à travers leurs réseaux
pourraient affecter l’activité de Deezer ;
• L’activité de Deezer nécessite des volumes significatifs de capacité de
stockage des données pour mettre efficacement en œuvre son activité ;
• Deezer s’appuie sur la disponibilité de son contenu audio et le system log
data qui est stocké sur ses serveurs Netapp. Toute perturbation ou
interférence avec l’utilisation de ses serveurs affecterait ses activités, en
particulier parce-que son sytème de stockage du contenu audio n’est pas
entièrement redondant ;
• La plupart des logiciels de Deezer est fondée sur du logiciel d’accès libre,
ce qui pourrait restreindre la façon dont Deezer utilise ou distribue ses
services ou nécessite qu’il libère le code source de certains services
faisant l’objet de ces licences ;
(vii) risques financiers et risques relatifs à l’organisation structurelle de Deezer:
• Deezer a un historique d’exploitation limité et un historique de pertes, et
pourrait ne pas être rentable dans le futur ;
• Deezer pourrait être sujet à des risques fiscaux ;
• Les changements dans le traitement fiscal des sociétés réalisant du
commerce électronique pourraient affecter les utilisations commerciales
15
•
•
•
•
•
des sites Deezer et son résultat financier ;
Les résultats d’exploitation de Deezer pourraient fluctuer d’une période
sur l’autre ;
Deezer pourrait chercher à l’avenir à lever des fonds, et un tel
financement pourrait ne pas être disponible ou ne pas l’être à des
conditions acceptables ;
Dans le futur, Deezer pourrait être contraint de payer les ayants droits
plus rapidement qu’elle ne le fait actuellement ou d’effectuer des
paiements anticipés;
L’activité de Deezer est sujette à des risques qui pourraient ne pas être
entièrement couverts par ses assurances ;
Certains des actionnaires importants de Deezer pourraient avoir des
intérêts qui divergent de ceux de Deezer ;
(viii) risques réglementaires et juridiques :
• Si la législation ou la règlementation relative aux réseaux internet et
mobile évolue, Deezer pourrait avoir à modifier la manière dont il met en
œuvre son activité, ou à engager des dépenses d’exploitation plus
importantes ;
• Si les droits de propriété intellectuelle et autres droits de propriété de
Deezer ne sont pas suffisamment protégés contre leur utilisation ou leur
appropriation par ses concurrents, la valeur de sa marque et autres actifs
incorporels pourrait diminuer, et son activité pourrait être affectée ;
• Les réclamations portant sur des droits de propriété intellectuelle
formulées à l’encontre de Deezer pourraient être coûteuses et conduire à
une perte d’importants droits relatifs notamment à son site internet, sa
technologie de streaming, sa technologie de recommandation et de
commercialisation, ses procédés de sélection de titres et ses activités de
marketing ;
• Si Deezer enfreint les termes des licences portant sur ses logiciels d’accès
libre, il pourrait être contraint de publier les détails de son code source
exclusif, ce qui pourrait affecter son positionnement concurrentiel ; et
D.3
Principaux
risques propres à
l’Offre et aux
actions de la
Société
(ix) risques financiers consistant en des risques tenant à la fluctuation des taux de
change.
Les principaux facteurs de risques liés à l’Offre ou aux actions de la Société
figurent ci-après :
• Un marché actif pourrait ne pas se développer pour les actions de la
Société admises aux négociations, ce qui pourrait significativement
affecter la liquidité et le prix de marché des actions de la Société ;
• Le prix de marché des actions de la Société pourrait être volatile;
• Le principal actionnaire de la Société continuera à détenir une part
significative du capital de la Société et pourrait ainsi influer sur les
activités ou les décisions prises par la Société ;
• Le Contrat de Garantie portant sur l’Offre pourrait ne pas être signé, ce
qui pourrait conduire à une annulation rétroactive de l’Offre ;
• Le Contrat de Garantie portant sur l’Offre pourrait être résilié jusqu’à la
date de règlement-livraison de l’Offre (incluse), entraînant une annulation
rétroactive de l’Offre, ainsi que de toutes les négociations des actions de
la Société intervenues depuis la date des premières négociations, chaque
investisseur faisant son affaire personnelle du manque à gagner et des
coûts résultant d’une telle annulation ;
• La cession par la Société ou les Actionnaires Cédants d’un nombre
important d’actions de la Société à l’issue des périodes de conservation
applicables ou la possibilité d’une telle cession pourraient avoir un effet
défavorable sur le prix de marché de l’action de la Société ;
• Les investisseurs pourraient ne pas percevoir de dividende comme cela
16
•
est indiqué dans la politique du Groupe en matière de dividende ;
Les actions de la Société pourraient tomber dans le champ d’application
de la taxe sur les transactions financières française et pourraient être
soumises à la taxe sur les transactions financières européenne.
17
Section E – Offre
E.1
Montant total du
produit de
l’Offre et
estimation des
dépenses totales
liées à l’Offre
Emission des Actions Deezer Nouvelles
Produit brut de l’émission des Actions Deezer Nouvelles
Le produit brut de l’émission des Actions Deezer Nouvelles s’élève à un montant
d’environ €300 millions.
Dans le cas où les souscriptions dans le cadre de l’Offre représenteraient au moins
75 % de sa taille initiale, la taille de l’augmentation de capital pourrait être réduite
à hauteur du montant des souscriptions reçues.
Produit net estimé de l’émission des Actions Deezer Nouvelles
Le produit net de l’émission des Actions Deezer Nouvelles s’élève à un montant
d’environ €291 millions.
Les dépenses liées à l’Offre à la charge de la Société sont estimées à environ €8
millions.
Cession des Actions Cédées
Produit brut de la cession des Actions Cédées
Le produit brut de la cession des Actions Cédées s’élève à un montant d’environ
€45 millions.
Les Actionnaires Cédants recevront le produit net de la cession des Actions
Cédées, si l’Option de Surallocation (tel que ce terme est défini ci-après) est
exercée.
E.2a
Raisons de
l’Offre /
Utilisation
prévue du
produit de celleci
L’Offre a pour objectif de permettre au Groupe de développer et d’élargir sa base
d’abonnés ; objectif en vue duquel le Groupe entend principalement (i) investir
dans le marketing au travers de medias traditionnels, de contenus audio spécifiques
et d’opportunités de marketing liés aux artistes, afin de différencier le service
offert par la Société, (ii) optimiser l’élargissement de sa base d’abonnés en
s’appuyant notamment sur la publicité gratuite, la gestion de la relation clients,
l’offre promotionnelle et, sur certains marchés, un marketing web et mobile direct
et (iii) co-financer des campagnes d’élargissement de la base de clients sur des
marchés où son service est disponible, au travers de partenariats de
commercialisation avec des opérateurs telecom actuels et nouveaux, ainsi que
d’autres partenaires. La réduction de la taille de l’Offre à hauteur du montant des
souscriptions reçues serait sans impact significatif sur l’affectation des fonds.
Les Actionnaires Cédants recevront le produit net de la cession des Actions
Cédées, si l’Option de Surallocation (tel que ce terme est défini ci-après) est
exercée.
E.3
Modalités et
conditions de
l’Offre
Nature et nombre des titres offerts dans le cadre de l’Offre
L’Offre consistera en (i) jusqu’à 8 241 758 Actions Deezer Nouvelles, et (ii)
jusqu’à 1 236 264 Actions Deezer Existantes cédées par DC Music Sàrl, Idinvest
Partners, CM-CIC Capital Privé, M. Daniel Marhely, M. Thomas Erhel et M.
Xavier Niel (les « Actionnaires Cédants ») (Les « Actions Cédées », avec les
Actions Deezer Nouvelles, les « Actions Offertes ») en cas d’exercice en totalité
de l’Option de Surallocation (tel que ce terme est défini ci-après). Les Actions
Deezer Nouvelles et les Actions Cédées ont une valeur nominale de 0.01€ chacune,
intégralement souscrites et entièrement libérées et de même catégorie.
Toutes les Actions Deezer sont des actions ordinaires (issues de la conversion des
18
Actions A et Actions B en actions ordinaires à la date de détermination du Prix de
l’Offre) et donnent actuellement un droit à dividende qui pourrait être distribué par
la Société conformément à ses statuts.
Structure de l’Offre
Il est prévu que la diffusion des Actions Offertes sur Euronext paris soit réalisée
dans le cadre d’une offre globale (l’ « Offre »), comprenant :
• un placement global (le « Placement Global ») principalement destiné
aux investisseurs institutionnels comportant :
- un placement en France; et
- un placement privé international dans certains pays, y compris aux
États-Unis d’Amérique en vertu de la Règle 144A (« Règle 144A »)
du US Securities Act de 1933, tel qu’amendé (le « Securities Act »),
et à l’extérieur des États-Unis d’Amérique en vertu de la Regulation
S (« Régulation S ») du Securities Act ; et
• une offre au public en France sous la forme d’une offre à prix ouvert
principalement destinée aux personnes physiques (l’ « Offre à Prix
Ouvert »).
Si la demande exprimée dans le cadre de l’Offre à Prix Ouvert le permet, le
nombre d’actions allouées en réponse aux ordres émis dans le cadre de l’Offre à
Prix Ouvert sera au moins égal à 10% du nombre d’Actions Nouvelles Deezer. Si
la demande exprimée dans le cadre de l’Offre à Prix Ouvert est de moins de 10%
du nombre d’Actions Nouvelles Deezer dans le cadre de l’Offre, les Actions
Nouvelles Deezer restantes non–allouées à l’OPO seront offertes dans le cadre du
Placement Global.
Les ordres seront décomposés en fonction du nombre de titres demandés :
•
fraction d’ordre A1 : de 10 à 200 actions ; et
•
fraction d’ordre A2 : au-delà de 200 actions.
Les fractions d’ordre A1 bénéficieront d’un traitement préférentiel par rapport aux
fractions d’ordres A2 dans le cas où tous les ordres A ne pourraient pas être
entièrement satisfaits.
Option de Surallocation
Les Actionnaires Cédants consentiront à BNP PARIBAS agissant en tant qu’agent
stabilisateur, au nom et pour le compte des Etablissements Garants, une option
permettant l’acquisition d’un nombre d’actions représentant un maximum de 15 %
du nombre d’Actions Deezer Nouvelles dans le cadre de l’Offre (soit 1 236 264
actions sur la base de la borne inférieure de la fourchette indicative du Prix de
l’Offre) (l’ « Option de Surallocation ») au prix de l’Offre.
Cette Option de Surallocation pourra être exercée par BNP PARIBAS, au nom et
pour le compte des Etablissements Garants, en une seule fois, à tout moment, en
tout ou partie, au Prix de l’Offre, au plus tard le 26 Novembre 2015 inclus (selon le
calendrier indicatif), uniquement afin de couvrir d’éventuelles surallocations et de
faciliter les opérations de stabilisation, le cas échéant.
19
Fourchette indicative de prix de l’offre et méthodes de fixation du Prix de l’Offre
Fourchette indicative de prix de l’offre
Le prix des Actions Offertes (le « Prix de l’Offre ») sera le même dans l’Offre à
Prix Ouvert et dans le Placement Global.
Le prix indicatif de l’Offre est compris entre 36,40 euros et 49,24 euros par action,
fourchette arrêtée par le Conseil d’Administration de la Société. La fourchette est
seulement indicative et le Prix de l’Offre pourra être fixé en dehors de cette
fourchette indicative de prix de l’offre. La fourchette indicative de prix de l’offre
pourra être modifiée à tout moment jusqu’au jour prévu pour la fixation du Prix de
l’Offre (inclus). En cas de modification de la borne supérieure de la fourchette
indicative de prix de l’offre susvisée, ou de fixation du Prix de l’Offre au-dessus de
la fourchette (initiale ou, le cas échéant, modifiée), la date de clôture de l’Offre à
Prix Ouvert sera reportée ou une nouvelle période de souscription à l’Offre à Prix
Ouvert sera alors ouverte, selon le cas, de telle sorte qu’il s’écoule au moins deux
jours de bourse entre la date de diffusion du communiqué de presse informant de
cette modification et la nouvelle date de clôture de l’Offre à Prix Ouvert. Les
ordres émis dans le cadre de l’Offre à Prix Ouvert avant la diffusion du
communiqué de presse susvisé seront maintenus sauf s’ils ont été expressément
révoqués avant la nouvelle date de clôture de l’Offre à Prix Ouvert incluse.
Le Prix de l’Offre pourra être librement fixé en dessous de la fourchette indicative
de prix de l’offre sans restriction, ou à défaut la fourchette indicative de prix de
l’offre pourra être abaissée sans restriction, en l’absence d’impact significatif sur
les autres caractéristiques de l’Offre.
Méthode de fixation du prix de l’offre
Il est prévu que le Prix de l’Offre soit fixé le 27 octobre 2015 selon le calendrier
indicatif de l’Offre. Cette date pourrait être reportée si les conditions de marché et
les résultats de la construction du livre d’ordres ne permettent pas de fixer le Prix
de l’Offre à cette date, à des conditions satisfaisantes. La date de fixation du Prix
de l’Offre pourra également être avancée en cas de clôture anticipée de l’Offre à
Prix Ouvert ou du Placement Global ou retardée en cas de prorogation de l’Offre à
Prix Ouvert ou du Placement Global.
Le Prix de l’Offre sera fixé en prenant en compte le nombre d’Actions Offertes
dans le cadre de l’Offre, et les demandes émises par les investisseurs selon la
technique dit de la « construction du livre d’ordres », telle que développée par les
usages professionnels.
Garantie
L’Offre sera réalisée selon les termes d’un contrat de garantie concernant les
Actions Offertes (« le Contrat de Garantie ») conclu entre la Société, certains
Actionnaire Cédants, BNP Paribas et Merrill Lynch International, en qualité de
Chefs de File et Teneurs de Livre Associés (les « Coordinateurs Globaux »), et
Citigroup Global Markets Limited et Société Générale, en qualité de Teneurs de
Livre Associés ( les « Teneurs de Livre Associés » et, ensemble avec les
Coordinateurs Globaux, les « Établissements Garants »). Le Contrat de Garantie
ne constitue pas une garantie de bonne fin au sens de l’article L. 225-145 du Code
de commerce.
Le Contrat de Garantie sera signé le jour de la fixation du Prix de l’Offre, prévue,
selon le calendrier indicatif, le 27 octobre 2015.
20
Le Contrat de Garantie pourrait être résilié par les Coordinateurs Globaux au nom
et pour le compte des Établissements Garants sous certaines circonstances à tout
moment jusqu’à la date de règlement-livraison de l’Offre (incluse), prévue, selon
le calendrier indicatif, le 29 octobre 2015. Les circonstances pouvant conduire à la
résiliation du Contrat de Garantie incluent notamment les cas d’inexactitude ou de
non-respect des déclarations et garanties ou de l’un des engagements de la Société
ou de certains Actionnaires Cédants, l’hypothèse où, l’une des conditions
suspensives usuelles ne serait pas réalisée, un changement défavorable significatif
dans la situation de la Société ou du Groupe, ou encore en cas de survenance de
certains événements spécifiques de marché, en particulier en France, aux EtatsUnis ou au Royaume-Uni (y compris la suspension des réglements des opérations
sur titres, paiements ou services de compensations, moratoire sur les activités
bancaires commerciales, déclenchement ou escalades d’hostilités ou d’actes de
terrorisme, ou autres crises ou évènement nationaux ou internationaux) rendant
l’opération, de l’avis des Coordinateurs Globaux impraticable ou déconseillée.
Calendrier indicatif
14 octobre 2015...................................... Visa de l’AMF sur le Prospectus
15 octobre 2015...................................... Diffusion du communiqué de presse
annonçant l’Offre et la mise à
disposition du Prospectus.
Publication par Euronext Paris de
l’avis d’ouverture de l’Offre à Prix
Ouvert.
Ouverture de l’Offre.
26 octobre 2015 ...................................... Clôture de l’Offre à Prix Ouvert à 17
heures (heure de Paris) pour les
souscriptions aux guichets et à 20
heures (heure de Paris) pour les
souscriptions par Internet
27 octobre 2015...................................... Clôture du Placement Global à 12
heures (heure de Paris)
Fixation du Prix de l’Offre
Signature du Contrat de Garantie
Publication par Euronext Paris de
l’avis de résultat de l’Offre
Diffusion du communiqué de presse
indiquant le Prix de l’Offre et le
résultat de l’Offre.
Première Cotation des actions de la
Société sur Euronext Paris
Début de la période de stabilisation
éventuelle
28 octobre 2015 ...................................... Début des négociations des Actions
Nouvelles de Deezeer sur Euronext
Paris sous forme de promesses
d’actions (sur une ligne de cotation
21
intitulée « DZR-Promesses » jusqu’à
la date de règlement-livraison de
l’Offre à Prix Ouvert et du Placement
Global)
29 octobre 2015...................................... Règlement-livraison de l’Offre
30 octobre 2015...................................... Début des négociations des actions de
Deezer sur Euronext Paris sur une
ligne de cotation intitulée « DZR »
26 novembre 2015 .................................. Date limite d’exercice de l’Option de
Surallocation
Fin de la période de stabilisation
Modalités de souscription
Les personnes désirant participer à l’Offre à Prix Ouvert devront déposer leurs
ordres auprès d’un intermédiaire financier habilité en France, au plus tard le 26
octobre 2015 à 17 heures (heure de Paris) pour les souscriptions aux guichets et 20
heures (heure de Paris) pour les souscriptions par Internet.
Pour être pris en compte, les ordres émis dans le cadre du Placement Global
devront être reçus par l’un ou plusieurs des Teneurs de Livre Associés au plus tard
le 27 octobre 2015 à 12 heures (heure de Paris), sauf clôture anticipée.
Coordinateurs globaux
BNP PARIBAS
BofA Merrill Lynch
Teneurs de Livre Associés
CITIGROUP
Société Générale Corporate & Investment Banking
Engagements de souscription reçus
Sans objet.
Stabilisation
Aux termes du Contrat de Garantie, BNP PARIBAS, agissant au nom et pour le
compte des Etablissements Garants, pourra (mais ne sera en aucun cas tenu de)
réaliser des opérations de stabilisation, lesquelles sont susceptibles d’affecter le
prix de marché des Actions Deezer et peuvent aboutir à la fixation d’un prix de
marché des Actions Deezer sur Euronext Paris plus élevé que celui qui prévaudrait
en leur absence. De telles interventions pourront être réalisées par, BNP PARIBAS
à tout moment, pendant une période de 30 jours calendaires à compter du jour de la
fixation du Prix de l’Offre soit, selon le calendrier indicatif, jusqu’au 26 novembre
2015 (inclus).
Offres concurrentes d’actions de la Société
Sans objet.
22
E.4
Intérêts pouvant
influer
sensiblement sur
l’Offre
Les Établissements Garants et/ou certains de leurs affiliés ont rendu ou pourront
rendre à l’avenir diverses prestations de services bancaires, financiers,
d’investissements, commerciaux ou autres au Groupe, aux Actionnaires Cédants,
leurs affiliés ou actionnaires ou à leurs mandataires sociaux, dans le cadre
desquelles ils ont reçu ou pourront recevoir une rémunération.
E.5
Personne ou
entité offrant de
vendre des
actions /
Convention de
blocage
Les Actionnaires Cédants se sont engagés à céder un maximum de 1 236 264
Actions Deezer Existantes en cas d’exercice intégral de l’Option de Surallocation.
Engagements d’abstention de la Société
Pendant une période expirant 360 jours calendaires suivant la date de règlementlivraison de l’Offre, sous réserve de certaines exceptions.
Engagement de conservation des actionnaires cédants
Pendant une période expirant 180 jours calendaires suivant la date de règlementlivraison de l’Option de Surallocation, sous réserve de certaines exceptions.
Engagement de conservation des actionnaires non cédants
Engagement de conservation des dirigeants et salariés
E.6
Montant et
pourcentage de
la dilution
résultant
immédiatement
de l’Offre
Impact de l’Offre sur les capitaux propres consolidés du Groupe
(en euros par action)
Avant émission
Nouvelles
des
Capitaux propres consolidés par action
ordinaire au 30 juin 2015
Actions
Deezer
Après émission du nombre maximum
d’Actions Deezer Nouvelles (sur la base de
la borne inférieure de la fourchette indicative
de prix de l’offre)
0,18 euros
12,46 euros
Montant et pourcentage de la dilution résultant immédiatement de l’Offre
(en %)
Avant émission
Nouvelles
E.7
Dépenses
facturées
à
l’investisseur par
la Société
Capitaux propres consolidés par action
ordinaire au 30 juin 2015
des
Actions
Deezer
1,00 %
Après émission du nombre maximum
d’Actions Deezer Nouvelles (sur la base de
la borne inférieure de la fourchette indicative
de prix de l’offre)
0,66 %
Sans objet.
23
SUMMARY
Summaries are made up of disclosure requirements known as “Elements”. These Elements are set out in Sections A
to E (numbered A.1 to E.7).
This summary contains all the Elements required to be included in a summary for this type of security and issuer.
Because some Elements are not required to be addressed, there may be gaps in the numbering sequence of the
Elements.
Even though an Element may be required to be inserted in the summary because of the type of securities and issuer,
it is possible that no relevant information can be given regarding that Element. In this case, a short description of
the Element is included in the summary with the mention of “not applicable”.
Section A – Introduction and warnings
A.1
Introduction and
warning to the
reader
This summary must be read as an introduction to the Prospectus and is provided to
assist investors considering whether to invest in Deezer Shares, but is not a
substitute for the Prospectus.
Any decision to invest in Offer Shares should be based on consideration of the
Prospectus as a whole.
In the event a claim relating to the Prospectus is brought before a court in a
Member State of the European Economic Area, the plaintiff may, under the
national legislation of the Member State where the claim is brought, be required to
bear the costs of translating the Prospectus before the legal proceedings are
initiated.
The individuals who have presented this summary, including any translation
thereof, and have requested notification in accordance with Article 212-41 of the
AMF’s General Regulations, may be subject to civil liability only if the content of
this summary is misleading, inaccurate or inconsistent when read together with the
other parts of the Prospectus, or if it does not provide, when read together with
other parts of the Prospectus, key information in order to assist investors who are
considering investing in Offer Shares (as defined below).
A.2
Consent of the
Company
Not applicable.
24
Section B – Company
B.1
Legal and
commercial
name
Legal name: Deezer S.A. (the “Company” and along with its consolidated subsidiaries,
“Deezer” or the “Group”)
Commercial name: Deezer
B.2
B.3
Registered
office/ Legal
form/
Applicable
legislation/
Country of
incorporation
Operations
and principal
activities
Registered office: 12, rue d’Athènes, 75009 Paris
Legal form: limited liability company (société anonyme)
Applicable legislation: French law
Country of incorporation: France
Deezer is a leading global provider of on demand digital audio streaming services,
offering millions of subscribers access to streamed music from a catalogue of over 35
million tracks and 40,000 news and entertainment talk shows and podcasts. Deezer’s
users can listen to individually customized music playlists and radio channels on their
web enabled device or hardware of choice, including laptops, tablets, smartphones,
smart TVs and wireless audio systems. Deezer’s audio catalogue is available for
streaming in over 180 countries.
Deezer’s revenues consist primarily of subscription fees received from its subscribers,
either directly or through its partners. Its revenues depend primarily on the number of
its subscribers and the mix of subscriber categories (standalone subscriptions
representing 45.6% of 2014 consolidated revenue and bundle subscriptions representing
49.5%). Deezer also earns revenue from selling advertising space on its platform (such
as advertisements between the playback of its audio content, which may take the format
of banners and other on screen displays or videos) (3.8% of 2014 consolidated revenue).
The majority of Deezer’s expenses (79.3% of 2014 consolidated revenue) are content
royalties payable to rights holders. Deezer also incurs expenses for product
development, sales and marketing and general administration.
As of December 31, 2014, Deezer had 6.9 million total subscribers. This includes 1.3
million standalone subscribers (who either subscribed directly to Deezer’s service or
elected to subscribe to its service through one of its partners), and 1.6 million monthly
active bundle subscribers (who subscribed to Deezer’s service through a bundled offer
from one of its telecom partners and streamed at least 30 seconds of one track in the
applicable month). Deezer’s standalone and monthly active bundle subscriber base
grew by 39.2% in 2014, and by 4.5% in the first half of 2015.
Deezer’s results of operations are recorded in five geographical segments: France,
Europe, Latin America, United States and Rest of World. France is Deezer’s largest
segment, with an activity that is sufficiently developed to have reached operating
profitability. Deezer’s activities in other areas are newer and growing very quickly, but
have not yet reached operating profitability.
Deezer’s consolidated revenue has grown significantly over the past three years, from
€63.6 million in 2012, to €92.8 million in 2013, to €141.9 million in 2014. First half
2015 revenue was €93.2 million, representing an increase of 40.9% compared to the
same period in 2014. This rapid revenue growth has been driven primarily by a
significant increase in Deezer’s revenue-generating subscriber base, which has more
than doubled since the end of 2012.
The substantial growth in revenue has resulted in a similar increase in gross margin
(which is equal to revenues less content royalty charges and other costs of revenue). In
2014, gross margin represented 15.6% of revenue, and in the first half of 2015, gross
25
margin was 17.7% of revenue. Deezer expects gross margin to represent a greater share
of revenue as the business grows, and it shifts its focus from bundled subscriptions to a
greater standalone subscriber base.
Deezer has not yet recorded positive operating income, EBITDA or net income,
reflecting its status as a young company that has invested heavily in its technology, its
international deployment and building its customer base internationally. Deezer has
achieved positive EBITDA in France (calculated as the contribution to the margin for
France less corporate expenses equally allocated among the five segments) in each of
the past three years and in the first half of 2015, and its objective is to do the same in its
newer markets in the coming years.
B.4a
Recent trends
affecting the
Group and its
industry
Please see Section B.7 below for a presentation of selected key historical financial
information for the six months ended June 30, 2015.
Medium-term objectives
Deezer believes that, historically with limited investment, it has been able to achieve a
strong position in terms of the quality of its services, its geographic presence, its
catalogue and its well-established relationships with key strategic distribution partners
as well as the relevant audio content rights holders. The subscription streaming market
(comprised of paid subscriptions and advertising-supported tiers of subscription
services) is expected to become the largest distribution channel for recorded music in
the near future. Deezer intends to increase significantly its investments in key marketing
and other strategic initiatives in the next three years to take advantage of these
promising trends in the streaming market, with a view to achieving accelerated revenue
growth, and reaching monthly EBITDA and cash-flow breakeven by the end of 2018.
Revenue Objective
Deezer is targeting revenue of over €750 million in 2018. In 2014, Deezer recorded
€141.9 million of revenue. Deezer has generated a 37% increase in overall revenues in
July and August 2015 as compared to July and August of 2014, and is on track to
achieve an increase in revenue of more than 35% in 2015 as compared to 2014.
Deezer will seek to achieve accelerated revenue growth through a significant increase in
marketing and subscriber acquisition investments and ongoing innovation to increase
the attractiveness of the service to consumers, which is expected to continue to drive
high revenue growth, particularly in 2017 and 2018. Deezer believes that its revenue
growth will be supported primarily by its continued focus on standalone subscriptions.
Deezer expects that standalone subscriptions will represent a major part of its revenues
in the next few years, particularly in Deezer’s developed markets such as France and the
rest of Europe.
EBITDA Objective
Deezer aims to achieve monthly positive EBITDA and cash flow by the end of 2018, as
compared to an EBITDA loss of €21.0 million and a change in net cash position of
€(4.7) million for the year ended December 31, 2014. Deezer has already achieved
positive EBITDA in France in each of the past three years and in the first half of 2015, 1
and its objective is to do the same in its other markets in the coming years.
Deezer plans to implement a number of strategic initiatives that may initially cause
EBITDA to decline significantly, especially in 2016 and 2017, when Deezer plans to
significantly increase its marketing and commercial investments as compared to
1
EBITDA by segment is calculated using an equal allocation of corporate expenses in each segment.
26
previous years. By the end of 2018 Deezer expects that its marketing investments as a
percentage of revenue will have returned to a lower level.
The objectives presented above are subject to change or modification based on
uncertainties in the economic, financial, competitive, tax or regulatory environment and
other factors of which the Group may not have been aware as of the date of the
Registration Document registered by the AMF on September 21, 2015 under number
I.15-068 or as of the date of the Prospectus. The occurrence of one or more of the risks
described in Chapter 4 of the Registration Document, “Risk Factors”, could have an
impact on Deezer’s business, results, financial condition or prospects and therefore
jeopardize its ability to achieve the objectives presented above. Moreover, Deezer’s
ability to achieve its objectives depends on the success of its strategy, as described in
Chapter 6.3 of the Registration Document, “Strategy”. Deezer does not guarantee and
can give no assurance that the objectives described in this section will be achieved and
does not undertake to publish updates to this information.
B.5
Description of
the Group
The organizational chart below shows the Group’s ownership structure as of the date of
this Prospectus:
27
B.6
Principal
Shareholders
After the stock split decided by the extraordinary meeting of the shareholders of
October 9, 2015 (the “Stock Split”), and assuming that (i) all classes of shares have
been converted into ordinary shares 1 , and (ii) all outstanding warrants have been
exercised on or prior to the settlement date of the Offering (other than the Warrants07/09
held by Mr. Marc Oiknine, which the Company does not expect to be exercised on or
prior to the settlement date of the Offering), the Company’s non-diluted share capital
prior to the closing date of the Offering would be equal to €160,535.59 divided into
16,053,559 shares, par value €0.01, fully subscribed and paid-up, allocated as follows:
The following tables do not reflect the shares underlying the existing outstanding stock
options held by certain officers and employees of the Company and the warrants held
by Mr. Marc Oiknine.
Shareholders
Number of shares
Jonathan Benassaya
Daniel Marhely
Thomas Erhel
Xavier Niel
DC Music Sàrl(1)
Idinvest Partners
MIH(4)
Warner
Sony
EMI
Universal
Didier Bench
Former employees
Total
110,403
1,344,092
104,052
643,539
1,669,472
1,649,143
676,280
1,870,906
4,763,830(3)
439,669(5)
664,680
664,680
332,311
1,032,052
66,700
21,750
16,053,559(6)
% of share capital
(non-diluted)
0.7%
8.4%
0.6%
4.0%
10.4%
10.3%
4.2%
11.7%
29.7%
2.7%
4.1%
4.1%
2.1%
6.4%
0.4%
0.1%
100%
________
(1) DC Music Sàrl is the special investment vehicle Dotcorp Private Equity Fund III of the Rosenblum
brothers (founders of e-commerce company, Pixmania).
(2) The direct shareholder of Access Industries is AI European Holdings Sàrl of which the beneficial owner is
Mr. Len Blavatnik.
(3) This table reflects (i) the exercise by Mr. Simon Baldeyrou on the date of the determination of the
Offering Price of his call option giving the right to purchase 43,500 shares from several other shareholders
(such call option having no dilutive impact), and (ii) the sale of such 43,500 shares by Mr. Simon Baldeyrou
to Access Industries at a price equal to the Offering Price on the date of the determination of the Offering
Price.
(4) MIH is a subsidiary of Prosiebensat 1 Media AG.
(5) This figure reflects the number of exercisable warrants held by MIH on the basis of the lower end of the
indicative offering price range.
(6) Includes 3,200,034 newly-issued shares pursuant to the expected exercise of 1,919,133 warrants (on or
prior to the settlement date of the Offering by the relevant holders thereof (which warrants would otherwise
lapse as of such settlement)). As of the date of this Prospectus, the Company has received notice from the
relevant holders of 1,570,553 warrants of their exercise, subject to a settlement before December 31, 2015.
The aggregate proceeds from the exercise of such warrants based on their strike prices and other relevant
terms and conditions would be approximately €12 million. It is expected that the warrants held by Sony will
be exercised as their average exercise price is €7.9.
1
Upon the date of the determination of the Offering Price (October 27, 2015 according to the indicative timetable), in accordance with the
provisions of article 10.2.1 of the current bylaws of the Company, the class A preferred shares (the “Class A Shares”) and the class B
preferred shares (the “Class B Shares”) shall be automatically converted into ordinary shares and: (a) the conversion ratio applicable to Class
A Shares shall be either (i) one ordinary share for every one Class A Share if the Offering Price per share is above an amount corresponding
to the issuance price of the Class A Shares (plus a minimum return over holding period), or (ii) above one ordinary share for every one Class
A Share if the Offering Price per share is below such amount; and (b) the conversion ratio applicable to Class B Share shall be one ordinary
share for every one Class B Share, in any case. As the lower range of the Offering Price is above the amount corresponding to the issuance
price of the Class A Shares (plus a minimum return over holding period), the conversion ratio of the Class A Shares will be one ordinary
share for every one Class A Share.
28
Assuming all outstanding stock options and warrants were exercised prior to the
settlement date of the Offering, the total number of ordinary shares outstanding would
be 17,120,179 shares (24.9% of the fully diluted share capital of the Company as of the
date of this Prospectus).
As at closing of the Offering, and after the issuance of the maximum number of
8,241,758 New Deezer Shares sold at the lower end of the indicative offering price
range, the shareholding structure of the Company would be as follows:
Shareholders
Shareholding (excluding exercise
of the Over-Allotment Option)
Number of
shares
Jonathan Benassaya
Daniel Marhely
Thomas Erhel
Xavier Niel
DC Music Sàrl
Idinvest Partners
Access Industries
MIH
Warner
Sony
EMI
Universal
Didier Bench
Public
Total
110,403
1,344,092
104,052
643,539
1,669,472
1,649,143
676,280
1,870,906
4,763,830
439,669
664,680
664,680
332,311
1,032,052
66,700
8,263,508
24,295,317
% of share
capital
0.5%
5.5%
0.4%
2.6%
6.9%
6.8%
2.8%
7.7%
19.6%
1.8%
2.7%
2.7%
1.4%
4.2%
0.3%
34.0%
100%
Shareholding (assuming full
exercise of the Over-Allotment
Option)
Number of
shares
110,403
1,071,089
82,918
512,828
1,330,380
1,314,180
538,919
1,870,906
4,763,830
439,669
664,680
664,680
332,311
1,032,052
66,700
9,499,772
24,295,317
% of share
capital
0.5%
4.4%
0.3%
2.1%
5.5%
5.4%
2.2%
7.7%
19.6%
1.8%
2.7%
2.7%
1.4%
4.2%
0.3%
39.1%
100%
As at closing of the Offering, and after the issuance of the maximum number of
6,092,608 New Deezer Shares sold at the higher end of the indicative offering price
range, the shareholding structure of the Company would be as follows:
Shareholding (excluding exercise
of the Over-Allotment Option)
Shareholders
Number of
shares
Jonathan Benassaya
Daniel Marhely
Thomas Erhel
Xavier Niel
DC Music Sàrl
Idinvest Partners
Access Industries
MIH
Warner
Sony
EMI
Universal
Didier Bench
Public
Total
110,403
1,344,092
104,052
643,539
1,669,472
1,649,143
676,280
1,870,906
4,763,830
406,174
664,680
664,680
332,311
1,032,052
66,700
6,114,358
22,112,671
29
% of share
capital
0.5%
6.1%
0.5%
2.9%
7.5%
7.5%
3.1%
8.5%
21.5%
1.8%
3.0%
3.0%
1.5%
4.7%
0.3%
27.7%
100%
Shareholding (assuming full
exercise of the Over-Allotment
Option)
Number of
shares
110,403
1,142,278
88,429
546,913
1,418,803
1,401,526
574,738
1,870,906
4,763,830
406,174
664,680
664,680
332,311
1,032,052
66,700
7,028,249
22,112,671
% of share
capital
0.5%
5.2%
0.4%
2.5%
6.4%
6.3%
2.6%
8.5%
21.5%
1.8%
3.0%
3.0%
1.5%
4.7%
0.3%
31.8%
100%
B.7
Selected key
historical
financial
information
The selected financial information presented below is derived from Deezer’s
consolidated financial statements as of and for the years ended December 31, 2014,
2013 and 2012 (the “Annual Financial Statements”), and the interim condensed
consolidated financial statements as of and for the six months ended June 30, 2015 and
2014 (the “Half Year Financial Statements”). The Annual Financial Statements have
been prepared in accordance with IFRS as adopted by the European Union. The Half
Year Financial Statements have been prepared under IAS 34, “Interim Financial
Information,” the IFRS standard applicable to interim reporting.
The tables below present selected financial information of Deezer as of and for the
periods ended on the dates indicated below.
Year ended December 31,
(in thousands of euros)
2014
2013
2012
141,923
92,800
63,565
Gross margin ................
22,130
2,233
5,542
EBITDA(2) .......................
(20,958)
(38,507)
Operating loss ..............
(26,974)
Loss for the period ........
(27,175)
Revenue...........................
(1)
(3)
Six months ended
June 30,
2015
93,219
2014
66,137
16,531
9,228
(11,147)
(10,981)
(11,152)
(22,514)
(29,132)
(12,196)
(12,741)
(22,059)
(28,846)
(8,969)
(12,819)
____________________
(1) Includes the impact of minimum guaranteed payment obligations under Deezer’s licensing agreements
with record labels. Pursuant to some of Deezer’s licensing arrangements, Deezer is required to pay
record labels minimum guaranteed payments. The minimum guaranteed payments are generally paid in
part in advance and in part over the term of the license agreement. They are offset against total royalties
owed under the agreements. In 2012, Deezer entered into agreements providing for minimum guaranteed
payments that exceeded the anticipated amount of royalties that Deezer expected to be payable based on
expected usage, which negatively impacted Deezer’s gross margin for 2012 and 2013, and to a lesser
extent 2014. Deezer agreed to these minimum guaranteed payments in part to support its international
growth strategy at the time. Increased minimum guaranteed payments were required to extend Deezer’s
content licenses to new territories where it hoped to generate sufficient subscriber and revenue growth to
allow it to recoup such minimum guaranteed payments in the future. Deezer’s gross margin excluding
impact of the minimum guarantee charge was €24.1 million, €15.4 million and €10.9 million for the years
ended December 31, 2014, 2013 and 2012, respectively, and €17.1 million and €12.5 million for the six
months ended June 30, 2015 and 2014, respectively.
(2) EBITDA is equal to gross margin less product and development expenses, sales and marketing expenses
and general and administrative expenses. The definition of EBITDA used by Deezer may not be
comparable to similar terms used by other companies.
(3) Includes depreciation, amortization and provisions relating to minimum guaranteed payment obligations.
B.8
B.9
B.10
B.11
Selected key
pro forma
financial
information
Profit
forecasts or
estimates
Qualifications
in the audit
reports on the
historical
financial
information
Net working
capital
Not applicable.
None.
Not applicable.
The Company certifies that, in its opinion, the net consolidated working capital
available to the Group is sufficient for its requirements for the 12 months following the
date of this Prospectus without taking into account any anticipated proceeds from the
Offering.
30
Section C – Shares
C.1
Type, class and
identification
number of the
shares
Details of the Shares Being Listed
The shares for which admission to trading on the regulated market of Euronext
Paris (compartment A or B) is sought are:
(i) all of the 16,053,559 existing shares of the Company, with a nominal value of
€0.01 per share 1 (including the ordinary shares resulting from the exercise of
the all outstanding warrants (other than the Warrants07/09 held by Mr. Marc
Oiknine)) (the “Existing Deezer Shares”); and
(ii) up to 8,241,758 new shares to be issued by the Company (the “New Deezer
Shares”, and together with the Existing Deezer Shares, the “Deezer Shares”).
All Deezer Shares will be the same category of shares and have the same nominal
value.
Dividend Entitlement: All Deezer Shares are currently eligible to receive any
dividends issued by the Company in accordance with its bylaws.
Label for the shares : “Deezer”
ISIN Code: FR0013004959
Symbol: DZR
Compartment: Compartment A or B
ICB classification: 5553
C.2
Currency
Euros.
C.3
Number of
shares issued and
par value
After the Stock Split, and assuming that (i) all classes of shares have been
converted into ordinary shares, and (i) all outstanding warrants (other than the
Warrants07/09 held by Mr. Marc Oiknine) have been exercised on or prior to the
settlement date of the Offering, the Company’s share capital would be equal to
€160,535.59 divided into 16,053,559 shares, par value €0.01, fully subscribed and
paid-up.
The New Deezer Shares to be issued pursuant to a capital increase in cash by way
of a public offering, with cancellation of the preferential subscription rights, for a
total amount (including issuance premium) of approximately €300 million euros,
representing up to approximately 8,241,758 New Deezer Shares, on the basis of
the lower end of the indicative offering price range.
Upon issuance, the New Deezer Shares will be fully subscribed and paid-up and of
the same category as the Existing Deezer Shares.
The nominal value per share is 0.01 euro.
C.4
1
Description of
the rights
attached to the
In accordance with current provisions of French law and of the Company’s bylaws,
the Existing Deezer Shares and New Deezer Shares will have the following
principal rights, as of their admission to trading in the context of the Offering:
At the extraordinary general meeting of the shareholders of October 9, 2015, the shareholders resolved to reduce the nominal value of the
shares from €0.29 per share to €0.01 per share.
31
shares
•
•
•
•
dividend right and right to participate to the Company’s profits;
voting right;
preferential subscription right for securities of the same class;
right to a share of any liquidation surplus.
The bylaws of the Company, as modified and effective as of the date of and subject
to the listing of the Company’s shares on the regulated market of Euronext Paris,
by express derogation to Article L. 225-123 paragraph 3 of the French Commercial
Code, do not grant double voting rights to the shares of the Company.
C.5
C.6
Restrictions on
the free
transferability of
the shares
Admission
No provision of the bylaws restricts the transferability of the shares comprising the
Company’s share capital.
Application has been made for the Deezer Shares to be listed and admitted to
trading on compartment A or B of Euronext Paris.
According to the indicative timetable, the trading conditions of the Deezer Shares
will be set forth in a notice issued by Euronext Paris on October 27, 2015.
According to the indicative timetable, the first listing of the New Deezer Shares
and the Existing Deezer Shares on Euronext Paris is expected to occur on October
27, 2015, and trading on Euronext Paris (in the form of when-issued shares
(promesses d’actions) within the meaning of Article L. 228-10 of the Commercial
Code) is expected to commence on October 28, 2015.
From October 28, 2015 and up to (and including) the settlement date of the
Offering, which is expected to occur on October 29, 2015 (according to the
indicative timetable), the New Deezer Shares (in the form of when-issued shares
(promesses d’actions) within the meaning of Article L. 228-10 of the Commercial
Code) will be traded under the symbol “DZR - Promesses” and will be subject to
the condition precedent of the issuance of the depository certificate relating to the
issuance of the New Deezer Shares.
In the event the Underwriting Agreement (as defined below) is not executed, the
Offering will be cancelled retroactively. In the event the Underwriting Agreement
is terminated in accordance with its terms, the Offering will be cancelled
retroactively, the depository certificate will not be issued at the settlement date of
the Offering and all transactions relating to the Deezer Shares executed since the
initial trading will be cancelled retroactively. Each individual investor will assume
its own losses or costs resulting from such cancellation.
Beginning on October 30, 2015, the Deezer Shares will trade under the symbol
“DZR”.
As of the date of this Prospectus, no other application for the admission of shares
onto a regulated market has been made or is planned by the Company.
C.7
Dividend Policy
In accordance with applicable law and the Company’s bylaws, the Company’s
shareholders may at their annual general meeting, upon the recommendation of the
Company’s Board of Directors, authorize the distribution of dividends.
The Company’s dividend distribution policy will take into account the Company’s
results of operations, its financial condition, its growth strategy, its liquidity
requirements and the achievement of its objectives, and any other factor deemed
relevant by the Company’s Board of Directors.
32
The Company has not declared any dividends since its inception, including the
years ended December 31, 2012, 2013 et 2014. The Company currently intends to
focus on achieving growth and expects to reinvest any profits it generates into the
operation and growth of the Group’s business. Accordingly, the Company
currently does not anticipate paying dividends for the foreseeable future.
33
Section D – Risks
D.1
Key risks related
to the company
and its industry
The key risk factors related to the Company, the Group and its industry are as
follows:
(i) risks relating to the market for on-demand audio and streaming:
• Deezer’s business depends on increasing and continuing acceptance of
on-demand streaming as a music delivery format;
• The market for on demand audio streaming services is new and rapidly
evolving;
• Deezer operates in a highly competitive industry, and competitive
pressures could affect its revenues and growth;
• The audio streaming market may not develop in certain large markets
where it is not yet widely accepted or where streaming rights are not
available;
• Economic downturns in the markets in which Deezer operates may
adversely affect demand given that spending on streaming services is
discretionary;
(ii) risks relating to content:
• If Deezer is unable to negotiate and maintain license agreements with
rights holders on terms acceptable to it, or fails to comply with its
obligations under its license agreements, its business could be adversely
affected;
• If Deezer does not maintain licensing relationships with the major music
labels upon favorable terms or at all, its business, financial condition and
results of operations would be materially and adversely affected;
• Certain content licensing agreements are subject to “most favored
nations” clauses;
• Royalty payments to the content rights holders comprise most of Deezer’s
cost of revenues;
• Payments under Deezer’s licensing arrangements and partnership
agreements are subject to adjustment following audits;
• Deezer’s content providers generally must approve its service offerings;
• If Deezer does not secure licenses for popular local content in key
geographic markets, its business and growth prospects may be adversely
affected;
• Licenses from publishing rights holders may be difficult and costly to
obtain because publishing rights holders tend to be a dispersed and
fragmented group, and Deezer may have limited information on
publishing rights holders and royalties;
• Some of Deezer’s licensing arrangements with rights holders include
minimum guaranteed payment requirements;
• Deezer may be unable to acquire the rights to stream popular content
because the relevant rights holders refuse to grant licenses at all or only
agree to do so at very high prices;
• If a significant number of authors, composers and/or artists refuse to be
represented by larger record labels or publishers, Deezer’s transaction
costs to acquire content could materially increase, which could negatively
impact its business;
• Deezer does not maintain direct licenses with performers’ rights collective
societies and may be forced to do so in the future;
• Deezer’s royalty payments may increase significantly as it expands to
include other categories of audio content;
(iii) risks relating to subscriber acquisition and churn:
• Deezer may not be successful in attracting consumers to its paid
34
•
•
•
•
•
•
•
subscription services;
Deezer’s results of operations depend on its ability to establish and
maintain relationships on favorable terms with distribution partners that
promote and distribute Deezer’s services;
Deezer may be unable to renew its partnership agreements with its
various distributions partners when they expire, particularly its
partnership agreement with Orange in France, on favorable terms or at all;
Deezer’s business may be adversely affected if its distribution partners’
brand, reputation, or business is harmed or if its distribution partners fail
to distribute and promote Deezer’s services effectively;
Deezer’s marketing campaigns and promotional activities may not be
cost-efficient or effective in attracting or retaining subscribers, which may
have a material adverse effect on its profitability;
If Deezer experiences excessive rates of subscriber churn, its revenues
and business could be adversely affected;
A failure to predict consumer content preferences accurately may
adversely affect subscriber acquisition and churn rates;
Deezer’s business and prospects depend on the strength of its brand, and
failure to maintain and enhance its brand would harm its ability to expand
its base of subscribers, content providers, advertisers and other partners;
(iv) risks relating to third-party service providers and distribution partners:
• Deezer relies in part on third-party application stores to distribute its
mobile application and collect subscription fees, and changes to their
license agreements, particularly an increase in commissions charged by
such stores, could have an adverse effect on Deezer;
• If Deezer’s technology and systems become incompatible with the
technologies of its distribution partners, it may not remain competitive
and its business may fail to grow or decline;
• Deezer relies on third-party service providers to manage servers on its
network, and to provide certain software and operating systems. Failures,
error or disruptions in such network, software or operating systems could
harm Deezer’s reputation and business;
(v) risks relating to Deezer’s business plan and strategy:
• Deezer’s business plan and strategy are subject to change;
• Failure by Deezer to effectively manage growth may negatively affect its
business, financial condition and results of operations;
• Deezer depends on certain key managers and skilled personnel, and any
failure to attract, retain and motivate well-qualified employees could
harm its business;
• Expansion of Deezer into new categories of audio content and new genres
of music may not be successful;
• Deezer’s international operations and growth strategy exposes it to
various economic, political, regulatory and other risks in multiple
jurisdictions;
• Deezer’s business depends on its ability to attract new advertisers and
retain existing advertisers;
• Deezer may from time to time pursue acquisitions;
(vi) risks relating to data and information technology systems:
• Privacy concerns and data protection law and regulations could limit
Deezer’s ability to collect and monetize its subscriber data;
• Security breaches resulting in unauthorized access to or disclosure of
subscriber data could damage Deezer’s reputation and substantially harm
its business and results of operations;
• Significant interruptions in Deezer’s service due to issues with its
35
•
•
•
•
•
•
•
network could lead to loss of subscribers and users;
Deezer is generally subject to service level obligations under its
partnership agreements, and a significant disruption in its computer
systems, user interface or mobile applications could result in a loss or
degradation of service and give rise to liability under its partnership
agreements;
Deezer’s proprietary software and systems may come under significant
pressure as its operations grow, and delays in or the failure to upgrade the
software and systems efficiently may disrupt operations or result in
increased operating costs and liability;
Deezer’s platform is accessed over the internet and mobile networks. If
the infrastructure for such networks stagnates, deteriorates, or is
ineffective or unreliable, Deezer may be unable to provide service to
subscribers;
Changes in how network operators handle and charge for access to data
that is transmitted across their networks could adversely impact Deezer’s
business;
Deezer requires significant volumes of data storage capacity to effectively
operate its business;
Deezer relies on the availability of its audio content and system log data
that is stored on its Netapp servers. Any disruption of or interference with
its use of its servers would have an adverse impact on its operations,
particularly because its audio content storage system is not fully
redundant;
Much of Deezer’s software is based on "open source" software, which
may restrict how Deezer uses or distributes its services or require that it
releases the source code of certain services subject to those licenses;
(vii) financial risks and risks relating to Deezer’s organizational structure:
• Deezer has a limited operating history and history of net losses, and it
may not be successful in achieving profitability in the future;
• Deezer may be subject to tax risks;
• Changes in tax treatment of companies engaged in e-business may
adversely affect the commercial use of Deezer’s sites and financial result,
in particular those resulting from the publication of the final BEPS report
by the OECD;
• Deezer’s operating results may fluctuate from period to period;
• Deezer may seek to raise capital in the future and such financing may not
be available on acceptable terms or at all;
• Deezer may in the future be required to pay rights holders more quickly
than is currently the case or make such payments in advance;
• Deezer’s business is subject to risks which may not be fully covered by its
insurance;
• Certain of Deezer’s significant shareholders may have interests that
diverge from those of Deezer;
(viii) regulatory and legal risks:
• If government regulations relating to the internet or mobile networks
change, Deezer may need to alter the manner in which it conducts its
business, or incur greater operating expenses;
• If Deezer’s intellectual property and other proprietary rights are not
adequately protected to prevent use or appropriation by its competitors,
the value of its brand and other intangible assets may be diminished, and
its business may be adversely affected;
• Intellectual property claims against Deezer could be costly and result in
the loss of significant rights related to, among other things, its web site,
streaming technology, its recommendation and merchandising technology,
36
•
D.3
Key Risks
related to the
shares
title selection processes and marketing activities;
If Deezer breaches the terms of its open source software licenses it may
be compelled to publish details of its proprietary source code which could
adversely affect its competitive position; and
(ix) market risks consisting of risks related to fluctuations in currency exchange
rates.
The principal risk factors related to Deezer Shares and the Offering and are as
follows:
• An active trading market for the Company’s shares may not develop
which could significantly affect the liquidity and market price for the
Company’s shares.
• The market price of the Company’s shares may be volatile.
• The Company’s principal shareholder will continue to hold a significant
portion of the Company’s share capital following the Offering and could
therefore influence the policies and decisions of the Company.
• The Underwriting Agreement relating to the Offering may not be signed,
which could lead to a retroactive cancellation of the Offering.
• The Underwriting Agreement relating to the Offering may be terminated
in certain circumstances up to (and including) the settlement date of the
Offering, which could cause a retroactive cancellation of the Offering and
of trades in the Company’s shares, and each investor would bear its own
costs in relation to such cancellation.
• The sale by the Company or the Selling Shareholders of a significant
number of the Company’s shares as from the end of the applicable lockup period or the possibility of such sales may adversely affect the
Company’s share price.
• Investors may not receive any dividends as provided for in the Group’s
dividend policy.
• The Company’s shares may fall within the scope of the French financial
transactions tax and could be subject to the European financial
transactions tax.
37
Section E – Offer
E.1
Total proceeds of
the Offering and
estimated
expenses of the
Offering
Issuance of New Deezer Shares
Gross proceeds of the issuance of New Deezer Shares
The gross proceeds of the issuance of New Deezer Shares are expected to be
approximately €300 million.
In the event subscriptions received represent at least 75% of its initial
contemplated size, the Offering size of the share capital increase could be reduced
to the amount of the subscription received.
Estimated net proceeds of the issuance of New Deezer Shares
The net proceeds of the issuance of New Deezer Shares are expected to be
The expenses of the Company for the Offering are estimated to be approximately
€8 million.
Sale of Sale Shares
Gross proceeds of the sale of Sale Shares
The gross proceeds of the sale of Sale Shares are expected to be approximately €45
million.
The Selling Shareholders will receive the net proceeds from the sale of Sale Shares
if the Over-Allotment Option (as defined below) is exercised.
E.2a
Reasons for the
Offering and use
of proceeds
The purpose of the Offering is to enable the Group to develop and enlarge its
subscriber base, which the Group intends to do primarily by: (i) investing in
marketing in traditional media and targeted audio content and artist marketing
opportunities to differentiate the Company’s service offering, (ii) optimizing its
subscriber acquisition by leveraging its free advertising-supported service and
customer relationship management, offering promotions and in certain markets
participating in direct web and mobile marketing, among other customer
acquisition initiatives, and (iii) co-financing customer acquisition campaigns in
markets in which its service is available, through distribution partnerships with
current and new telecom operators as well as other partners. The reduction of the
Offering size to the amount of the subscription received would not have any
significant impact on the use of proceeds.
The Selling Shareholders will receive the net proceeds from their sale of Sale
Shares if the Over-Allotment Option (as defined below) is exercised.
38
E.3
Terms and
Conditions of the
Offering
Number and type of shares
The Offering will consist of (i) up to 8,241,758 New Deezer Shares, and (ii) up to
1,236,264 Existing Deezer Shares sold by DC Music Sàrl, Idinvest Partners, CMCIC Capital Privé, Mr. Daniel Marhely, Mr. Thomas Erhel and Mr. Xavier Niel
(the “Selling Shareholders”) (the “Sale Shares”, and together with the New
Deezer Shares, the “Offer Shares”) in the event of the exercise in full of the OverAllotment Option (as defined below). The New Deezer Shares and the Sale Shares
each have a par value of €0.01, are fully subscribed and paid up and are all of the
same class.
All Deezer Shares are ordinary shares (resulting from the conversion in ordinary
shares of Class A and Class B Shares at the date of the determination of the
Offering Price) and currently eligible to receive any dividend issued by the
Company in accordance with its bylaws.
Structure of the Offering
It is expected that the initial public offering of the Company’s shares for trading on
Euronext Paris will be structured as a global offering (the “Offering”) composed
of:
• An international offering (the “International Offering”) primarily to
institutional investors, which will be composed of:
o a private placement in France; and
o an international private placement in certain other countries,
including in the United States to qualified institutional buyers in
reliance on Rule 144A (“Rule 144A”) under the Securities Act of
1933, as amended (the “Securities Act”), and outside of the United
States in reliance on Regulation S (“Regulation S”) under the
Securities Act; and
• and a public offering to retail investors in France, made by means of an
open price retail offering (offre à prix ouvert) (the “French Public
Offering”).
If demand in the French Public Offering is sufficient, the number of shares
allocated in response to orders placed in the French Public Offering will be equal
to at least 10% of the number of New Deezer Shares sold in the Offering. If
demand in the French Public Offering is less than 10% of the number of New
Deezer Shares to be offered in the Offering, the remaining New Deezer Shares not
allocated to the French Public Offering will be offered under the International
Offering.
Subscription orders will be categorized by the number of shares requested:
•
A1 orders: between 10 and 200 shares;
•
A2 orders: more than 200 shares.
The A1 orders will benefit from preferential treatment as compared to the A2
orders in the event that all orders cannot be satisfied in their entirety.
Over-Allotment Option
The Selling Shareholders will grant BNP PARIBAS, acting as stabilizing manager,
39
on behalf of the Underwriters, an option to purchase existing shares representing
up to 15% of the New Deezer Shares offered in the Offering (i.e., 1,236,264 shares
based on the lower end of the indicative offering price range) (the “OverAllotment Option”) at the Offering Price.
The Over-Allotment Option may be exercised by BNP PARIBAS, on behalf of the
Underwriters, in whole or in part on one occasion at the Offering Price at any time
up to and including November 26, 2015 at the latest (based on the indicative
timetable set forth herein), solely to cover over-allotments, if any, in the Offering,
and to facilitate stabilization activities, if any.
Indicative offering price range and method for fixing price
Indicative offering price range
The price of the Offer Shares (the “Offering Price”) will be the same in the
French Public Offering and the International Offering.
The indicative offering price range for the Offering is between €36.40 and €49.24
per share, as decided by the Board of Directors of the Company. This price range
is indicative only and the Offering Price may be outside of this range. The
indicative offering price range may be modified at any time up to and including the
date of the determination of the Offering Price. In the event of a modification of
the upper limit of the indicative offering price range, or in the event that the
Offering Price is set above the upper limit of the initial (or, if applicable, amended)
indicative offering price range, the closing date of the French Public Offering will
be deferred or a new subscription period will be opened, as applicable, such that
there are at least two market days between the press release announcing such
change and the revised closing date of the French Public Offering. Subscription
orders placed in the context of the French Public Offering prior to the date of such
press release will be maintained unless they are expressly revoked prior to or on
the revised closing date of the French Public Offering.
The Offering Price may be fixed below the indicative offering price range without
restriction or the lower limit of the indicative offering price range may be lowered
without restriction, provided that there is no material impact on the other terms and
conditions of the Offering.
Method for fixing price
It is expected that the Offering Price will be determined on October 27, 2015
according to the indicative timetable set forth herein. This date may be delayed
depending on market conditions and/or in the event that the results of the book
building process do not permit the fixing of the Offering Price on such date at
satisfactory conditions. The date of determination of the Offering Price may be
earlier in the event of an early closing of the French Public Offering or
International Offering, or may be delayed in the event of an extension of the
French Public Offering or International Offering.
The Offering Price will be determined taking into account the amount of New
Deezer Shares offered in the Offering and the demand for New Deezer Shares
from investors during the book building process, as such term is understood in the
marketplace (usages professionnels).
Underwriting
The Offering will be made pursuant to the terms of an underwriting agreement
relating to the Offer Shares (the “Underwriting Agreement”) between the
40
Company, certain Selling Shareholders, BNP PARIBAS and Merrill Lynch
International, as joint global coordinators and joint bookrunners (the “Joint
Global Coordinators”), and Citigroup Global Markets Limited and Société
Générale, as joint bookrunners (the “Joint Bookrunners” and, together with the
Joint Global Coordinators, the “Underwriters”). The Underwriting Agreement
does not constitute a performance guarantee (garantie de bonne fin) within the
meaning of Article L. 225-145 of the French Commercial Code.
The Underwriting Agreement will be signed as of the date of determination of the
Offering Price, which is expected to be October 27, 2015 based on the indicative
timetable.
The Underwriting Agreement may be terminated by the Joint Global Coordinators
on behalf of the Underwriters under certain circumstances at any time up to and
including the settlement and delivery date of the Offering, expected to be October
29, 2015 based on the indicative timetable. The circumstances under which the
Underwriting Agreement may be terminated include a breach by the Company or
of Selling Shareholders party thereto of any representations, warranties or
undertakings in the Underwriting Agreement, failure to satisfy certain typical
conditions precedent to the Offering, an event or circumstance having a material
adverse effect on the business or prospects of the Company or the Group, or
certain unfavorable changes in market conditions, particularly in France, the
United States or the United Kingdom (including the suspension of securities
settlement, payment or clearance services, moratorium on commercial banking
activities, outbreak or escalation of hostilities or acts of terrorism, or other national
or international calamity or crisis), that make it, in the good faith judgment of the
Joint Global Coordinators, impracticable or inadvisable to proceed with the
Offering, on the terms and in the manner contemplated.
Indicative timetable
October 14, 2015 .................................... Visa of the AMF on the Prospectus
October 15, 2015 .................................... Press release announcing the Offering
and the procedure by which the
Prospectus has been made available to
the public
Publication by Euronext Paris of a
notice relating to the opening of the
French Public Offering
Opening of the Offering
October 26, 2015 .................................... Closing of the French Public Offering
at 17:00 (CET) for subscriptions
placed in person and at 20:00(CET)
for subscriptions placed online
October 27, 2015 .................................... Closing of the International Offering
at 12:00 (CET)
Determination of the Offering Price
Signature of
Agreement
the
Underwriting
Publication by Euronext Paris of a
notice relating to the results of the
41
Offering
Press release announcing the Offering
Price and the results of the Offering
First listing of the Company’s shares
on Euronext Paris
Beginning of the stabilization period
October 28, 2015 .................................... Opening of the trading for the New
Deezer Shares on Euronext Paris in
the form of when issued shares
(promesses d’actions) (traded under
the symbol “DZR -Promesses” until
the settlement date of the International
Offering and the French Public
Offering)
October 29, 2015 .................................... Settlement date of the Offering
October 30, 2015 .................................... Opening of trading of the Deezer
Shares on Euronext Paris under the
symbol “DZR”
November 26, 2015 ................................ Deadline for the exercise of the OverAllotment Option
End of the stabilization period
Terms and conditions of subscription
Persons wishing to participate in the French Public Offering should place their
orders with an eligible financial intermediary in France, at the latest by October
26, 2015 at 17:00 (Paris time) for subscriptions made at in person at the branches
of the relevant financial institutions (souscriptions aux guichets) and 20:00 (Paris
time) for subscriptions made via Internet.
All orders placed in the International Offering must be received by one or more of
the Joint Bookrunners no later than October 27, 2015 at 12:00 (Paris time), except
in the case of early closing.
Joint Global Coordinators and Joint Book Runners
BNP PARIBAS
BofA Merrill Lynch
Joint Bookrunners
CITIGROUP
Société Générale Corporate & Investment Banking
Subscription commitments
Not applicable.
Stabilization
Pursuant to the terms of the Underwriting Agreement, BNP PARIBAS, on behalf
of the Underwriters, may (but is under no obligation to) effect stabilization
transactions, which may have an effect on the market price of the Deezer Shares
and may support a market price of the shares on Euronext Paris at a level higher
than that which might otherwise prevail in the open market. Such stabilization
42
transactions may be undertaken by BNP PARIBAS at any time during a period of
30 calendar days from the date of determination of the Offering Price, or up to and
including November 26, 2015 according to the indicative timetable.
E.4
E.5
Interests that
could materially
influence to the
Offering
Persons or
entities selling
shares/ Lock-up
agreements
Concurrent offers of Company shares
Not applicable.
The Underwriters and/or certain of their affiliates have provided or may provide in
the future various banking, financial, investment, commercial services or otherwise
to the Group, the Selling Shareholders, their affiliates or officers, under which they
have received or may receive compensation
The Selling Shareholders have agreed to sell a maximum of 1,236,264 Existing
Deezer Shares in the event the Over-Allocation Option is exercised in full.
Company lock-up
A period of 360 calendar days following the settlement date of the Offering,
subject to certain exceptions.
Selling shareholder lock-up
A period of 180 calendar days following the settlement date of the Over-Allotment
Option, subject to certain exceptions.
Non-selling shareholder lock-up
Company’s officer and employee lock-up
E.6
Amount and
percentage of
dilution resulting
from the
Offering
Impact of the Offering on the consolidated equity of Deezer
(in euros per share)
Consolidated equity per ordinary share as
of June 30, 2015
Prior to the issuance of the New Deezer
Shares
0.18 euros
Following the issuance of up to 8,241,758
New Deezer shares (based on the lower end
of the indicative offering price range)
12.46 euros
Amount and percentage dilution resulting from the Offering
E.7
Estimated
expenses charged
to the investor by
the Company
(in %)
Consolidated equity per ordinary share as
of June 30, 2015
Prior to the issuance of the New Deezer
Shares
1.00%
Following the issuance of up to 8,241,758
New Deezer shares (based on the lower end
of the indicative offering price range)
0.66%
Not applicable.
43
1
PERSONS RESPONSIBLE FOR THE PROSPECTUS
1.1
PERSON RESPONSIBLE
1.1.1
Persons Responsible for the Prospectus
Hans Holger Albrecht, Chief Executive Officer of Deezer.
1.2
ATTESTATION BY THE PERSON RESPONSIBLE
I hereby certify, having taken all reasonable measures to this effect, that the information contained in this
Prospectus is, to the best of my knowledge, in accordance with the facts and contains no omission likely
to affect its import.
I have obtained from the statutory auditors a letter of completion of their work (lettre de fin de travaux)
in which they state that they have verified the information relating to the financial position and the
consolidated financial statements presented in this Prospectus, and have read this Prospectus in its
entirety.
October 14, 2015
Hans Holger Albrecht
Chief Executive Officer
1.3
NAME AND POSITION OF THE PERSON RESPONSIBLE FOR FINANCIAL INFORMATION
Mr. Ivan Tortet
Chief Financial Officer of Deezer S.A.
12, rue d’Athènes – 75009 Paris, France
Tel: +33 (0)1 55 80 69 00
44
RISK FACTORS RELATING TO THE ADMISSION OF THE DEEZER SHARES TO
TRADING ON THE REGULATED MARKET OF EURONEXT PARIS
2
Before making any decision to invest in the Company’s shares, prospective investors should carefully
review all of the information contained in this Prospectus, including the risk factors set forth in this
Section 2 of the Securities Note as well as those described in Chapter 4 “Risk Factors” of the
Registration Document. An investment into the Company’s shares involves risks. The material risk
factors that the Company has identified as of the date of the visa granted by the AMF on this Prospectus
are set forth in this Section 2 and in Chapter 4, “Risk Factors” of the Registration Document. If one of
these risks were to occur it could have a material adverse effect on the Group’s business, results of
operations, financial condition and prospects. In this case, the market price of the Company’s shares
may decrease and the investors may lose all or part of their investment. Investors should note that this
list of risks is not exhaustive and that there may be other risks that have not yet been identified by the
Company as of the date of the Prospectus, or whose occurrence as of the date hereof is not considered
likely to have a material adverse effect on the Company’s business, results of operations, financial
condition and prospects or on the price of the shares of the Company.
AN ACTIVE TRADING MARKET FOR THE COMPANY’S SHARES MAY NOT DEVELOP.
2.1
Prior to their admission to trading on Euronext Paris, there has been no public market for the Company’s
shares. The offering price range was determined based on a variety of factors and is not an indication of
the market price of the Company’s shares following their admission to trading on Euronext Paris, which
may vary substantially from the offering price range. Although the Company has applied for admission
of its shares to trading on Euronext Paris, the Company cannot assure investors that a liquid trading
market will develop for its shares or, if such a market develops, that it will persist. If a liquid trading
market does not develop, the liquidity and price of the shares may be adversely affected.
THE COMPANY’S PRINCIPAL SHAREHOLDER WILL CONTINUE TO HOLD A SIGNIFICANT
PORTION OF THE COMPANY’S SHARE CAPITAL FOLLOWING THE OFFERING.
2.2
As of the settlement date of the Offering, Access Industries 1 will hold at least 19% of the Company’s
voting rights. As a result, Access Industries will be the Company’s key shareholder. Access Industries
will continue to have a significant influence on the Group and on the resolutions submitted for a vote at
shareholders’ meetings, such as the appointment of board members, the approval of annual financial
statements, the distribution of dividends and changes to the Company’s share capital and bylaws.
THE MARKET PRICE OF THE COMPANY’S SHARES MAY BE VOLATILE.
2.3
The market price of the Company’s shares may experience significant volatility and may fluctuate due to
a variety of factors, many of which are beyond the Group’s control. These factors may include, among
others, market reaction to:
•
1
variations in the Group’s or its competitors’ financial results or prospects from one period to
another;
The direct shareholder of Access Industries is AI European Holdings Sàrl of which the beneficial owner is Mr. Len Blavatnik.
45
•
announcements made by the Group’s competitors or other companies with similar businesses
and/or announcements relating to the financial and operating performance of those companies or
their outlook or announcements with respect to the audio streaming market;
•
adverse political, economic or regulatory developments in the countries and markets in which
the Group operates, or legal or regulatory proceedings involving the Group;
•
announcements relating to changes in the shareholding structure of the Group;
•
announcements relating to changes in the Group’s officers or key employees; and
•
announcements relating to the Group’s scope of assets (acquisitions, sales, etc.).
In addition, stock markets generally have experienced significant fluctuations in recent years
(particularly since the start of the global economic crisis). These fluctuations have not always been
related to the performance or prospects of the specific companies whose shares are traded. Broad market
fluctuations and general economic conditions may adversely affect the market price of the Company’s
shares and cause the value of an investors’ investment in the Company’s shares to decline.
2.4
THE UNDERWRITING AGREEMENT RELATING TO THE OFFERING MAY NOT BE EXECUTED OR
MAY BE TERMINATED IN CERTAIN CIRCUMSTANCES.
The Underwriting Agreement (as defined in Section 5.4.3, “Underwriting”, of this Securities Note)
relating to the Offer Shares offered in the Offering may not be executed or may be terminated under
certain conditions by the Joint Global Coordinators on behalf of the Underwriters (as defined in Section
5.4.3, “Underwriting”, of this Securities Note) at any time up to and including the settlement date of the
Offering (see Section 5.4.3, “Underwriting”, of this Securities Note). In the event the Underwriting
Agreement is not executed or is terminated in accordance with its terms, the Offering, as well as all buy
orders placed in this respect, will be cancelled retroactively, the depository certificate with respect to the
capital increase will not be issued and all transactions relating to the Company’s shares executed up to
(and including) the settlement-delivery date will be cancelled retroactively and unwound. In each case,
each individual investor will personally assume its own losses or costs resulting from such cancellation.
In the event that the Underwriting Agreement is not executed or is terminated, the Deezer Shares will not
be listed on Euronext Paris, and this information will be published by the Company in a press release
and in a notice issued by Euronext Paris.
2.5
THE SALE BY THE COMPANY OR THE SELLING SHAREHOLDERS OF A SIGNIFICANT NUMBER
OF THE COMPANY’S SHARES AS FROM THE END OF THE APPLICABLE LOCK-UP PERIOD OR
THE POSSIBILITY OF SUCH SALES MAY ADVERSELY AFFECT THE COMPANY’S SHARE PRICE
Sales of substantial amounts of the Company’s shares on the market following the Offering, or the
perception in the market that such a sale is imminent, could lower the price of the Company’s shares.
The Company and certain shareholders have contractually agreed, subject to certain exceptions, not to
issue, offer, sell, pledge or otherwise dispose of any shares in the Company or securities exchangeable
for or convertible into shares of the Company for certain limited periods of time following the Offering
(see Section 5.4.4, “Lock-up Agreements”, of this Securities Note). Following the expiration of the
applicable period, or upon waiver of the lock-up restrictions by the Underwriters, the Company and its
shareholders will be free to offer, sell, pledge or otherwise dispose of their shares. This could have an
adverse effect on the market price for the Company’s shares.
46
2.6
INVESTORS MAY NOT RECEIVE DIVIDENDS, AS PROVIDED FOR IN THE GROUP’S DIVIDEND
POLICY.
The Company currently intends to focus on achieving growth and expects to reinvest any profits it
generates into the operation and growth of its business. Accordingly, the Company currently does not
anticipate paying dividends for the foreseeable future. Any future determination to pay dividends on the
Company’s capital stock will be at the discretion of its board of directors and subject to approval by the
general shareholders meeting, subject to applicable laws, and will depend on the Company’s financial
condition, results of operations, capital requirements, general business conditions, and other factors that
the board of directors considers relevant. The Company cannot provide any assurance that it will pay any
dividends in the future, or as to the amount of the any dividends it might pay.
2.7
THE COMPANY’S SHARES MAY FALL WITHIN THE SCOPE OF THE FRENCH FINANCIAL
TRANSACTIONS TAX AND COULD BE SUBJECT TO THE EUROPEAN FINANCIAL
TRANSACTIONS TAX.
The shares of the Company may fall within the scope of the French financial transaction tax (“French
FTT”), which is applicable, under certain circumstances, to the acquisition of equity securities or
assimilated securities admitted to trading on a regulated market, which are issued by a company whose
registered office is located in France and whose market capitalization as of December 1 of the preceding
year exceeds €1 billion. Transaction on Company securities undertaken in 2015 will not be subject to
the French FTT. A list of the companies within the scope of the French FTT is published every year. The
Company may be on that list with effect as from January 1, 2016 if its market capitalization as of
December 1, 2015 exceeds €1 billion. If this is the case, the French FTT will be due in an amount equal
to 0.2% of the consideration paid for the equity instruments of the Company acquired on the secondary
market as from January 1, 2016 (subject to certain exceptions).
Prospective holders of the Company’s shares should be aware that the European Commission has
published a proposal for a Directive on a financial transaction tax (the “European FTT”) common to
Austria, Belgium, Estonia, France, Germany, Greece, Italy, Portugal, Slovenia, Slovakia and Spain) (the
“Participating Member States”) which, if enacted and implemented by France, would replace the French
FTT.
The proposed European FTT might, if introduced in its current draft form, apply, under certain
circumstances, to certain dealings involving the shares of the Company. The European FTT might apply
to both residents and non-residents of the Participating Member States.
According to joint statements issued by the Ministers of Participating Member States the implementation
of the European FTT would be carried out progressively, focusing initially on the taxation of shares and
some derivatives. They also expressed their willingness to create the conditions necessary to implement
the European FTT on January 1, 2016. The European FTT proposal remains however subject to
discussion between the Participating Member States. It may therefore be altered prior to any
implementation. Additional EU Member States may decide to participate.
Such taxes could increase the transaction costs associated with purchases and sales of the shares of the
Company and could reduce the liquidity of the market for the shares of the Company. Prospective
47
holders of the shares of the Company are advised to consult their usual tax advisor on the potential
consequences of the French FTT and of the European FTT.
48
3
KEY INFORMATION
3.1
STATEMENT ON THE NET WORKING CAPITAL
The Company certifies that, in its opinion, the net consolidated working capital available to the Group is
sufficient for its requirements for the 12 months following the date of this Prospectus without taking into
account any anticipated proceeds from the Offering.
3.2
CAPITALIZATION AND INDEBTEDNESS
In accordance with the recommendations of ESMA (European Securities Market Authority) of March,
2013 (ESMA/2013/319, paragraph 127), the following table sets out the capitalization and indebtedness
of Deezer as of August 31, 2015.
3.2.1
Capitalization and indebtedness at August 31, 2015 (Actual)
Deezer Capitalization and Indebtedness as of August 31, 2015
As of August 31,
2015
(Actual)
(in € thousands)
Total current debt ........................................................................................................................
871
Guaranteed .....................................................................................................................................
--
Secured ..........................................................................................................................................
--
Unguaranteed and unsecured .........................................................................................................
871
Total non-current debt (excluding current portion of long-term debt) ...................................
6,700
Guaranteed .....................................................................................................................................
--
Secured ..........................................................................................................................................
--
Unguaranteed and unsecured(1) ......................................................................................................
6,700
Shareholders’ equity attributable to owners of the parent company
Share capital ..................................................................................................................................
122
Legal reserve ..................................................................................................................................
--
(2)
Other reserves .............................................................................................................................
(15,377)
Non-controlling interests .............................................................................................................
1,023
Total shareholders’ equity ...........................................................................................................
(14,234)
Total ..............................................................................................................................................
(6,663)
__________________
(1)
Corresponds to non-current and non-cash basis financial liabilities in relation to the amount of warrants issued
to former shareholders of MIM on the basis of the same assumptions used for the balance sheet as of June 30,
2015. Such liabilities will no longer exist after the exercise of the warrants held by MIM on or prior to the
49
settlement date of the Offering.
(2)
Corresponds to additional paid in capital, retained earnings and currency translation adjustments. Other
reserves do not take into account the profit and loss for the months ended July 31 or August 31, 2015.
As of August 31,
2015
(Actual)
(in € thousands)
Cash and cash equivalents .............................................................................................................
36,067
Trading securities ...........................................................................................................................
--
Liquidity .......................................................................................................................................
36,067
Current financial receivables ......................................................................................................
--
Current bank debt ..........................................................................................................................
--
Other current financial debt ...........................................................................................................
871
Current financial debt .................................................................................................................
871
Net current financial indebtedness .............................................................................................
35,196
Non-current bank loans ..................................................................................................................
--
Bonds issued ..................................................................................................................................
--
Other non-current debts .................................................................................................................
6,700
Non-current financial indebtedness ...........................................................................................
6,700
Net financial indebtedness...........................................................................................................
28,496
The Company has no indirect or contingent indebtedness.
3.3
INTERESTS OF NATURAL AND LEGAL PERSONS PARTICIPATING IN THE OFFERING
The Underwriters (as defined in Section 5.4.3, “Underwriting”, of this Securities Note) and/or certain of
their affiliates have provided or may provide in the future various banking, financial, investment,
commercial services or otherwise to the Group, the Selling Shareholders (as defined in Section 5.1.1
“Conditions of the Offering”), their affiliates or officers, under which they have received or may receive
compensation.
50
3.4
REASONS FOR THE OFFERING AND USE OF PROCEEDS
The purpose of the Offering is to enable the Group to develop and enlarge its subscriber base, which the
Group intends to do primarily by: (i) investing in marketing in traditional media and targeted audio
content and artist marketing opportunities to differentiate the Company’s service offering, (ii) optimizing
its subscriber acquisition by leveraging its free advertising-supported service and customer relationship
management, offering promotions and in certain markets participating in direct web and mobile
marketing, among other customer acquisition initiatives, and (iii) co-financing customer acquisition
campaigns in markets in which its service is available, through distribution partnerships with current and
new telecom operators as well as other partners. The reduction of the Offering size to the amount of the
subscription received would not have any significant impact on the use of proceeds.
The Selling Shareholders will receive the net proceeds from their sale of Sale Shares if the OverAllotment Option (as defined below) is exercised.
4
INFORMATION ON THE SHARES TO BE OFFERED AND LISTED FOR TRADING
4.1
TYPE, CLASS AND DIVIDEND RIGHTS OF SHARES TO BE OFFERED AND LISTED FOR TRADING
The shares of the Company for which admission to trading on the regulated market of Euronext Paris
(compartment A or B) is sought are:
(i) all of the 16,053,559 Existing Deezer Shares; and
(ii) up to 8,241,758 New Deezer Shares.
Dividend rights
All Deezer Shares are currently eligible to receive any dividend issued by the Company in accordance
with its bylaws.
Label for shares
“Deezer”
ISIN Code
FR0013004959
Symbol
“DZR”
Compartment
A or B
ICB classification
5553
Commencement of trading of shares
According to the indicative timetable, the first listing of the New Deezer Shares and the Existing Deezer
Shares on Euronext Paris is expected to occur on October 27, 2015, and trading on Euronext Paris (in the
form of when-issued shares (promesses d’actions) within the meaning of Article L. 228-10 of the French
Commercial Code) is expected to commence on October 28, 2015.
51
From October 28, 2015 and up to (and including) the settlement date of the Offering, which is expected
to occur on October 29, 2015 (according to the indicative timetable), the Existing Deezer Shares and the
New Deezer Shares (in the form of when-issued shares (promesses d’actions) within the meaning of
Article L. 228-10 of the French Commercial Code) will be traded under the symbol “DZR -Promesses”
and will be subject to the condition precedent of the issuance of the depository certificate relating to the
issuance of the New Deezer Shares.
Beginning on October 30, 2015, the Deezer Shares will trade under the symbol “DZR”.
As of the date of this Prospectus, no other application for the admission of shares onto a regulated
market has been made or is planned by the Company.
APPLICABLE LAW AND JURISDICTION.
4.2
The Deezer Shares are governed by French law.
Any disputes that may arise during the Company’s term or during its liquidation, either among
shareholders or between the Company and its shareholders, with respect to the interpretation and
execution of the Company’s bylaws or generally relating to the Company’s business, are subject to the
jurisdiction of the relevant courts in the location of the Company’s registered office.
Accordingly, in the event of a dispute, all shareholders must provide an address within the jurisdiction of
the relevant courts in the location of the Company’s registered office. All summonses and notices will be
duly delivered to such address. If no address is provided, summonses and notices will be duly delivered
to the office of the Public Prosecutor of the Regional Court (Tribunal de grande instance) in the location
of the Company’s registered office.
FORM AND REGISTRATION OF THE DEEZER SHARES
4.3
The Company’s ordinary shares may be held in registered or bearer form, at the option of the
shareholder.
In accordance with Article L. 211-3 of the Monetary and Financial Code, the shares, regardless of their
form, will be dematerialized and ownership will be evidenced by book-entry in a securities account held
either by the Company or by an authorized intermediary. Accordingly, shareholders’ rights will be
evidenced by entry in a securities account opened in their name in the books of:
•
BNP Paribas Securities Services, for fully registered shares (nominatif pur);
•
BNP Paribas Securities Services, for registered shares credited to an administered account
(nominatif administré); or
•
an authorized intermediary (intermédiaire habilité) of their choice for bearer shares (au porteur).
In accordance with the provisions of Articles L. 211-15 and L. 211-17 of the Monetary and Financial
Code, shares will be transferred by account transfer and the transfer of the shares’ ownership will occur
once they are recorded as book-entries in the purchaser’s account.
An application will be made to admit shares to the clearing procedures of Euroclear France, which will
ensure the clearing of shares between accountholders. According to the indicative timetable, the
Company’s shares will be credited to securities accounts as of October 29, 2015.
52
4.4
CURRENCY OF THE SHARES
The Offering is denominated in Euros.
4.5
RIGHTS ATTACHED TO THE SHARES
The Company’s shares will be subject to provisions set out in the Company’s bylaws as adopted by the
Company’s shareholders’ meeting of October 9, 2015 and which will enter into force as from the
contemplated listing of the Company’s shares on the regulated market of Euronext Paris.
Based on applicable laws and on the provisions of the Company’s current bylaws that will govern the
Company as from the closing of the Offering, the rights attached to the shares are as follows:
Dividend rights – Right to participate to the Company’s profits
The Company’s shareholders have the right to participate to the Company’s profit pursuant to the
conditions provided under Articles L. 232-10 et seq. of the Commercial Code.
The Company's income statement summarizes the annual income and expenses and shows, after
deductions for amortization and reserves, the profits or losses for the fiscal year.
No less than five percent of the profit for the financial year, less any losses carried forward, shall be set
aside to form the legal reserve. This shall no longer be required once the legal reserve reaches one-tenth
of the share capital but shall resume if, the legal reserve falls below one-tenth for any reason.
Distributable income is equal to the profit for the fiscal year, less any prior losses and amounts
appropriated to the reserve pursuant to applicable law and the bylaws of the Company, plus any
accumulated income.
The shareholders’ meeting grant shareholders the option to receive all or part of the dividends distributed
in either cash or shares under the conditions set forth by applicable law. Shareholders may be granted the
same option with respect to the payment of interim dividends.
The shareholders’ meeting may deduct from this profit any amounts it may deem suitable to be allocated
to any ordinary or extraordinary optional reserve fund, or to be carried forward. Any remaining amount
is divided between the shareholders in proportion to the number of shares they hold.
Further, the shareholders’ meeting may also decide to distribute amounts withdrawn from reserves at its
disposal, by expressly indicating the reserve items from which the withdrawals are made. However,
dividends are withdrawn by priority from the distributable income of the fiscal year.
The shareholders’ meeting may also decide, on proposal of the Board of Directors, to distribute the
profits or reserves, in the form of assets in kind, including negotiable shares. In the case of a distribution
of negotiable shares that are not admitted to trading on a regulated market or an organized multilateral
trading facility or to which admission for trading on a regulated market or an organized multilateral
trading facility is not realized in the framework of such distribution, shareholders will be given the
option to receive either cash or shares.
However, except in the event of a capital decrease, no distribution will be made to shareholders when the
net equity is, or becomes, as a result of the distribution, less than the amount of share capital increased
by reserves, the distribution of which is prevented by applicable laws or the bylaws of the Company.
53
The New Deezer Shares will give right to any holder, with the same par value, to the same dividend as
that distributed to the Existing Deezer Shares carrying the same rights. Sale Shares carry rights as from
the date of their issuance.
The Company’s dividend distribution policy is described in Section 20.5, “Dividend distribution policy”,
of the Registration Document.
Voting rights
Subject to the provisions of this section, the voting rights attached to shares are proportional to the
percentage of capital that the shares represent. For the same par value, each share gives right to one vote.
By derogation to Article L. 225-123 paragraph 3 of the French Commercial Code, the bylaws do not
grant double voting rights to the shares of the Company.
In the case of shares are held by a beneficial owner, the voting rights attached to those shares belong to
the beneficial owner at ordinary shareholders’ meetings and to the bare owner at extraordinary
shareholders’ meetings.
In addition to the thresholds provided for by applicable laws and regulations, any natural person or legal
entity who comes to hold, acting alone or in concert, directly or indirectly, a number of shares
representing at least 3% of the share capital or voting rights, or any multiple of 1% thereafter, including
beyond the reporting thresholds provided for by laws and regulations, must inform the Company of the
total number of shares, voting rights, or securities giving access to the share capital or voting rights of
the Company that such person holds, as well as of any securities giving access to the share capital or to
voting rights potentially attached thereto, by registered letter with return receipt requested sent to the
Company’s registered office within four trading days after crossing such threshold(s).
In the event of a failure to comply with the above provisions, the legal penalties for breach of the
obligation to report crossing a legal threshold shall apply to thresholds provided for in the bylaws only
upon the request, recorded in the minutes of the shareholders’ meeting, of one or more shareholders
holding at least 3% of the Company’s share capital or voting rights.
Subject to the above provisions, this obligation under the bylaws is governed by the same provisions as
those governing the legal obligation, including with respect to shares deemed to be held.
The Company reserves the right to report the information provided or a breach of the above obligation
by the person in question to the public and to the Company’s shareholders in accordance with applicable
laws and regulations.
The same reporting obligation, with the same deadline and terms, applies each time the proportion of the
share capital or voting rights held by a shareholder decreases to below any of the thresholds referred to
above.
Preferential subscription rights attached to shares of the same class
The shares carry a preferential subscription right upon capital increase. Shareholders have, pro rata their
number of shares, a preferential right to subscribe in cash for shares issued in connection with an
immediate or deferred capital increase. During the subscription period, these preferential subscription
rights may be traded when they are separated from the underlying shares, provided that the underlying
shares are also tradable. Otherwise, preferential subscription rights may be transferred on the same basis
54
as the underlying shares. Shareholders may individually waive their preferential subscription rights
(articles L. 225-132 and L. 228-91 to L. 228-93 of the French Commercial Code).
Right to the surplus in the event of liquidation
Each share gives right to an equal share in the profits and ownership of the Company’s assets. In the
event of the Company’s liquidation, shareholders shall not be liable above the amount of the par value of
the shares they own.
Buyback and conversion clauses
The bylaws of the Company do not provide for any share buyback or conversion clause in respect of
ordinary shares.
Identification of the shareholders
The Company is entitled, at any moment, to request the identification of holders of bearer shares under
the conditions provided for by applicable laws and regulations.
If a person who is subject to an identification request does not provide the requested information within
the period provided for by applicable laws and regulations or provides incomplete or incorrect
information relating to such person, shareholders or number of shares owned by any such holders, then
the shares or other securities giving immediate or deferred access to the share capital of the Company
and that are recorded in the shareholder’s account shall be deprived from voting rights for any
shareholders’ meeting held until the identification request has been fulfilled. The payment of any
corresponding dividends shall also be deferred until such time.
4.6
AUTHORIZATIONS
4.6.1
Extraordinary General Meeting of the Shareholders dated October 9, 2015
The issuance of New Deezer Shares was authorized by the 7th resolution of the extraordinary general
meeting of the shareholders of the Company of October 9, 2015, as follows 1:
“Seventh resolution (Delegation to the Board of Directors of authority to decide a capital increase
through the issuance – with cancellation of the preferential subscription rights – of shares and/or
securities giving immediate or deferred access to the share capital of the Company or of another
company, by public offering).
The General Meeting, voting in accordance with the quorum and majority requirements for
Extraordinary Meetings, having reviewed the Board of Directors’ Report and the Statutory Auditors’
Special Report (issued on the basis of the initial draft resolution), in accordance with articles L. 225129, L. 225-129-2, L. 225-135, L.225-136, L.225-148, and L. 228-91 and seq. of the Commercial Code:
1. delegates to the Board of Directors, with powers to subdelegate as permitted by law, its
authority to carry out capital increases, with the cancellation of the preferential subscription rights, on
one or more occasions, in France or abroad, in the proportions and at the times it sees fit, through
public offerings, in euros or in any other currency or currency unit established by reference to more
than one currency, with or without issue premium, for valuable consideration or free consideration, by
1
Free translation for information purposes only.
55
issuing (i) Company’s shares (excluding preferred shares), or (ii) securities governed by articles L. 22892 paragraph 1, L. 228-93 paragraph 1 and paragraph 3, or L. 228-94 paragraph 2 of the Commercial
Code, giving immediate or deferred access, at any time or on a fixed date, by subscription, conversion,
exchange, redemption or presentation of a warrant or any other means, to the capital of the Company or
of other companies (including those which hold directly or indirectly more than half of the capital of the
Company and those of which the Company holds directly or indirectly more than half of the capital), it
being specified that subscription for such shares or other securities may be in cash, or by offset of
payable liquid debt, or by incorporation of reserves, profits or share premiums. These securities may in
particular be issued as consideration for securities contributed to the Company within the context of a
public exchange offer carried out in France or abroad under local rules (for example with a reverse
merger) relating to securities meeting the conditions laid down in article L. 225-148 of the Commercial
Code;
2. delegates to the Board of Directors, with powers to subdelegate as permitted by applicable
laws, its authority to carry out the issuance of shares or securities giving access to the capital of the
Company to be issued further to the issuance of securities giving access to the capital of the Company,
by companies of which the Company directly or indirectly holds more than half of the capital, or by
companies which directly or indirectly hold more than half of the capital of the Company ;
The present delegation automatically entails, in favor of the holders of securities to be issued by
companies of the group of the Company, a waiver by the shareholders of their preferential subscription
rights to be exercised on such securities;
3. decides to limit the authorized amounts of the capital increases carried out by the Board in
the scope of this delegation as follows:
•
the maximum nominal amount of capital increases that may be carried out immediately or in
the future pursuant to this delegation is equal to 105,000 euros, it being specified that this
amount will count towards the overall ceiling provided for in the second paragraph of the
sixth resolution adopted by this general meeting, or, if need be, towards the overall cap
provided for in a similar resolution adopted by a subsequent general meeting replacing this
delegation;
•
these ceilings will be completed, if need be, by the nominal amount of shares to be issued in
order to preserve the rights of the holders of securities giving rights to shares of the
Company in accordance with applicable laws and, if need be, with other adjustments
provided for in contractual provisions;
4. decides to limit as follows the amount of authorized debt instruments in the scope of the
issuance of securities giving access immediately or in the future to the capital of the Company or other
companies:
•
to 200 million euros or the equivalent in any other currency or currency unit established by
reference to more than one currency at the issuance date, the nominal amount of debt
instruments that may be issued immediately or in the future subsequently to this delegation;
•
this amount may be increased, if need be, by any reimbursement premium above the par
value;
•
this amount is independent from the amount of the debt instruments whose issuance may be
subsequent to the other resolutions submitted to this assembly and from the debt
instruments whose issuance may be decided or authorized by the Board in accordance with
56
articles L. 228-36-A, L. 228-40, L. 228-92 paragraph 3, L. 228-93 paragraph 6 and L. 22894 paragraph 3 of the Commercial Code;
5. decides to cancel the shareholders’ preferential subscription rights to the securities at stake
in this resolution, but reserving the right for the Board, in accordance with article L. 225-135 paragraph
5 of the Commercial Code, to grant the shareholders a preferential subscription delay during a time
lapse and under conditions it may decide in accordance with applicable laws. This delay may apply to
the issuance in whole or in part and shall not create any negotiable right. It shall be exercised
proportionately to the number of shares held by each shareholder and may be completed by a
subscription right on a reducible basis, it being specified that the unsubscribed securities will be
publicly offered in France or abroad;
6. resolves that, if the subscriptions, including, as the case may be, shareholders subscriptions,
did not cover the full amount of the issuance, the Board may, if need be, limit the amount of the issuance
to the amount of the received subscriptions if, including the shareholders subscriptions, it represents at
least three quarters of the planned issuance;
7. acknowledges that this delegation entails, in favor of the holders of securities giving rights to
the share capital of the Company, a waiver by the shareholders of their preferential subscription rights
to subscribe for the Company’s shares that may result from the securities giving access to the share
capital ;
8. acknowledges that, (i) for the purposes of the issuance in the context of the initial public
offering of the Company, the issuance price of the new shares will be set by the Board of Directors in
accordance with usual market practice in the context of an international offering, by reference to the
price offered to investors in such offering, as such price will result of the confrontation of the offer of the
securities and subscription requests from investors pursuant to the technique called “book building” as
developed by professional practice, and (ii) after the date of the listing of the shares of the Company on
the regulated market of Euronext Paris, in accordance with Article L. 225-136 paragraph 1 of the
Commercial Code:
•
the issue price of shares issued directly will be at least equal to the minimum
provided by applicable regulatory provisions on the day of the issue (as of this
writing, the weighted average of the quoted market prices on Euronext Paris
preceding the pricing of the capital increase less 5%), after, if necessary,
adjustment of this average in case of a difference between the dividend due dates;
•
the issue price of the securities conferring access to the share capital and the
number of shares to which conversion, redemption or more generally
transformation of each security giving access to the capital could give entitlement,
will be such that the amount received immediately by the Company increased by
any amount to be received subsequently by the Company will, for each share issued
as a consequence of the issuance of such securities, be at least equal to the
minimum subscription price defined in the previous paragraph.
9. decides that the Board of Directors will have comprehensive powers, having the option to
subdelegate under the conditions provided for by the law, to implement this delegation of authority, and
in particular to:
•
Decide to issue shares and/or securities giving immediate or deferred access to the
share capital;
•
Decide the amount of the capital increase, the issue price and the amount of any
premium that may be required upon the issuance;
57
•
Determine the dates and terms of the issuance, the nature, number and features of
the shares and/or the securities to be issued;
•
In the event of issue of debt securities, decide whether they should be subordinated
or not-subordinated (and, where applicable, their subordination ranking, pursuant
the provisions of Article L. 228-97 of the Commercial Code), set the interest rate
(including fixed or variable or zero-coupon or indexed interest rates) and provide
for obligatory or facultative cases for the suspension or non-payment of interest,
provide that they will be either fixed-term or perpetual securities, the possibility of
a reduction or increase in their nominal value and the other issue terms (including
the fact of granting them guarantees or security thereon) and of redemption
(including redemption by delivery of assets of the Company); where applicable,
these securities may provide for an option for the Company to issue debt securities
(fungible or non-fungible) as a consideration for interest, the payment of which may
have been suspended by the Company, or take the form of complex bonds within the
meaning of the stock market authorities (for instance, as a result of their terms of
redemption or consideration or of other rights such as indexation or options
possibilities); amend, during the term of the securities concerned, the terms
referred above, in compliance with applicable formalities;
•
Determine the issuance terms of the shares or securities giving access to the capital
to be issued immediately or in the future;
•
Set, if need be, the terms for exercising any rights (if need be, rights to conversion,
exchange, redemption, including through the delivery of Company assets such as
own shares held in treasury or securities already issued by the company) attached
to shares or to securities giving access to the share capital to be issued, and, in
particular, set the date, which may be retroactive, as from which new shares will
bear rights to, and any other terms and conditions of the share capital increase
completion;
•
Set the terms and conditions under which the company will be able to purchase or
trade on the stock market, at any time or during specified periods of time, securities
issued or to be issued in the perspective to be cancelled or not, pursuant to legal
provisions;
•
Provide for an option to suspend, if appropriate, the exercise of the rights attached
to the securities issued in accordance with the legal and regulatory provisions;
•
In the case of an issuance of securities as compensation for securities contributed
within the framework of a public offer with an exchange component (OPE),
establish the list of securities to be contributed to the exchange, set the terms of the
issuance, to set the exchange parity, as well as, where necessary, the amount of the
cash adjustment to be paid without that procedures for determining the purchase
price set in paragraph 9 of this resolution may be applicable and set the issuance
terms within the framework of either an OPE, an alternative purchase or exchange
offer, or a single offer proposing the purchase or exchange of selected securities in
exchange for a payment in cash and securities, or a public tender offer (OPA) or an
exchange offer followed by a subsidiary OPE or OPA, or any other form of public
offer that complies with applicable laws and regulations;
•
At its sole discretion, charge the costs of the capital increases against the share
premium arising thereon and debit from this amount the sums required for the legal
reserve;
58
•
Make all adjustments to take account of the impact of transactions involving the
capital or the equity of the company, in particular, in the event of a change in the
nominal value of the share, of a capital increase through incorporation of reserves,
a free allocation of shares, stock split or reverse stock split, distribution of dividend,
reserves or any other assets, redemption of capital or any other transaction
affecting shareholders' equity (including in case of an initial public offering and/or
in the event of a change of control), and set the terms on which any rights of
holders of securities giving access to the capital are to be preserved if need be
(including through adjustments in cash);
•
Acknowledge the completion of each share capital increase and proceed with the
amendments to the By-laws accordingly;
•
Generally speaking, enter into any agreement, in particular, to successfully
complete the proposed issues of shares or securities, to take all steps and to carry
out all formalities for the issue, listing and financial servicing of the shares or
securities issued pursuant to this delegation of powers and for the exercise of the
rights attached thereto;
10. decides that the Board of Directors may not use the powers granted by the present
delegation during a tender offer for the Company’s shares by any third party;
11. acknowledges the fact that, in the event that the Board of Directors uses this delegation, the
Board of Directors shall report to the next ordinary shareholders’ meeting the use made of this
delegation, in compliance with law and regulatory provisions ;
12. decides that this delegation is granted for a term of 26 months from the date of this
meeting.”
4.6.2
Board of Directors Meeting dated October 13, 2015
Using the above mentioned delegation of authority, the Board of Directors of the Company approved, on
October 13, 2015 the principle of a capital increase in cash by way of a public offering, with cancellation
of the preferential subscription rights, for a total amount (including issuance premium) of approximately
300 million euros by way of issuance of New Deezer Shares with a nominal value of 0.01 euro each.
The final terms and conditions of such capital increase and in particular the Offering Price and number
of New Deezer Shares will be provided by the Board of Directors of the Company during a meeting that
is expected to take place on October 27, 2015 pursuant to the indicative timetable.
4.7
EXPECTED ISSUE DATE AND SETTLEMENT DATE
According the indicative timetable, the expected issue date for the New Deezer Shares and the expected
settlement date for the Deezer Shares for listing and trading on Euronext Paris is October 29, 2015.
4.8
RESTRICTIONS ON THE FREE TRANSFERABILITY OF THE SHARES
No provision of the Company’s bylaws restricts the transferability of the Shares comprising the
Company’s share capital. A description of the undertakings of the Company and certain Selling
Shareholders is contained at Section 5.4.4, “Lock up Agreements”, of this Securities Note.
59
4.9
FRENCH REGULATIONS RELATING TO PUBLIC OFFER
In connection with the admission of the Deezer Shares for trading on Euronext Paris, the Company will
be subject to certain legal and regulatory requirements in France relating to public offerings, and in
particular those related to mandatory public offer and buy-out and squeeze-out transactions.
4.9.1
Mandatory public offer (offre publique obligatoire)
Article L. 433-3 of the Monetary and Financial Code (Code monétaire et financier) and Articles 324-1 et
seq. of the AMF’s General Regulations (Règlement général) set forth the conditions applicable to a
mandatory public tender offer which must be made for all capital securities and securities giving access
to the capital or to voting rights in a company whose shares are listed for trading on a regulated market
and the conditions under which the AMF may deem it compliant.
4.9.2
Buy-out offers and squeeze-outs (offre publique de retrait et retrait obligatoire)
Article L. 433-4 of the Monetary and Financial Code and Articles 236-1 et seq. (buyout offers), 237-1 et
seq. (squeeze-outs) and 237-14 et seq. (squeeze-out following any public tender offer) of the AMF’s
General Regulations set forth the conditions under which a buyout offer and a squeeze-out of minority
shareholders must be carried out in relation to a company whose shares are listed for trading on a
regulated market.
4.10
TAKEOVER BID FOR DEEZER S.A. INITIATED BY THIRD PARTIES DURING THE PRIOR OR
CURRENT FINANCIAL YEAR
As of the date of this Prospectus, no takeover bid for Deezer has been launched by third parties during
the prior or the current financial year.
4.11
WITHHOLDING TAXES AND OTHER TAXES APPLICABLE TO THE SHARES
The descriptions below, summarizing certain French tax consequences in terms of withholding taxes on
dividends paid by the Company and that may apply to persons who will become shareholders of the
Company, is based on the laws and regulations of France as currently in force.
The attention of such persons is drawn to the fact that this information is merely a summary, provided as
general information, of the withholding tax regime that could apply to the shares of the Company under
tax laws as currently in force. The rules set forth below may be affected by changes in legislation and
regulations which might apply retroactively or apply to the current year or fiscal year.
The tax information below is not a comprehensive description of all potential tax effects that could apply
in connection with the receipt of dividends and more generally to the shareholders of the Company.
They are advised to consult their usual tax advisor with respect to the tax regime applicable to their own
situation in connection with the acquisition, ownership and disposal of the shares of the Company.
Non-French tax residents must also comply with the applicable tax laws of their country of residence,
subject to the application of any double tax treaty entered into between such country of residence and
France.
It is specified that in no circumstances will the deductions or withholding taxes described in the below
developments be borne by the Company.
60
4.11.1
Shareholders who are resident of France for tax purposes
Individual shareholders resident of France for tax purposes, holding their shares in the Company as part
of their private estate, who do not hold their shares in the Company through an equity savings plan (plan
d'épargne en actions (“PEA”)), and who do not conduct stock market transactions under conditions
similar to those which define an activity carried out by a person conducting such operations on a
professional basis.
21% withholding tax
Under Article 117 quater of the French Tax Code (Code général des impôts or the "FTC"), subject to
certain exceptions mentioned below, dividends paid to individuals who are French tax residents are
subject to a withholding tax equal to 21% of the gross amount distributed. This withholding tax is levied
by the paying agent if it is established in France. If the paying agent is established outside France, the
dividends paid by the Company are declared, and the corresponding tax paid, within the first 15 days of
the month following the dividend payment, either by the taxpayer himself, or by the paying agent if
established in an EU Member State or European Economic Area member state that has signed a tax
agreement with France that contains an administrative assistance clause with a view to combating tax
fraud or tax evasion, provided that the paying agent has been granted a power of attorney for that
purpose by the taxpayer.
However, individuals belonging to a tax household whose taxable income for the year before last, as
defined in 1° of IV of Article 1417 of the FTC, is less than €50,000 for taxpayers who are single,
divorced or widowed, or €75,000 for couples filing jointly, may request an exemption from this
withholding under the terms and conditions of Article 242-quater of the FTC, i.e. by providing to the
paying agent, no later than November 30 of the year preceding the year of the payment of the dividends,
a sworn statement that the reference fiscal income shown on the taxation notice (avis d’imposition)
issued in respect of the second year preceding the year of payment was below the above-mentioned
taxable income thresholds. However, taxpayers who acquire new shares after the deadline for providing
the aforementioned exemption request can provide such exemption request to the paying agent upon
acquisition of such new shares pursuant to paragraph 320 of the administrative guidelines BOI-RPPMRCM-30-20-10-20140211.
When the paying agent is established outside France, only individuals belonging to a tax household
whose taxable income of the year before last, as defined in 1° of IV of Article 1417 of the FTC, is equal
or superior to the amounts mentioned in the previous paragraph are subject to this tax.
This withholding tax does not discharge the taxpayer from the payment of personal income tax on such
amounts nor from the payment of the exceptional contribution on high income earners, where applicable.
It however constitutes an installment on account of the taxpayer's final income tax and is creditable
against the final personal income tax due by the taxpayer with respect to the year during which it is
withheld, the surplus, if any, being refunded to the taxpayer. Shareholders concerned should seek advice
from their usual tax advisor to determine the taxation mechanism applicable to them in connection with
the shares of the Company.
The withholding tax does not apply to income relating to shares held through a PEA.
If dividends are paid outside France in a non-cooperative state or territory (“NCST”) within the meaning
of Article 238-0 A of the FTC, a 75% withholding tax is applicable within the conditions described in
61
Section 4.11.2, “Shareholders who are not resident of France for tax purposes” (third paragraph), of this
Securities Note. Relevant shareholders are advised to consult their usual tax advisor to determine the
method by which this withholding tax will be credited against the amount of their income tax.
Social security contributions
Whether or not the 21% withholding tax described above is applicable, the gross amount of the
dividends paid by the Company is also subject to social security contributions at an overall rate of
15.5%, which is divided as follows:
•
the contribution sociale généralisée (the “CSG”) at a rate of 8.2%;
•
the contribution pour le remboursement de la dette sociale (the “CRDS”) at a rate of 0.5%;
•
the prélèvement social at a rate of 4.5%;
•
the contribution additionnelle au prélèvement social at a rate of 0.3%; and
•
the prélèvement de solidarité instituted by the French social security financing act for 2013,
at a rate of 2%.
These social security contributions are levied in the same manner as the 21% withholding tax described
above where such 21% withholding tax is applicable. Specific rules, which vary depending on whether
the paying agent is established in France or not, apply where the 21% withholding tax is not applicable.
Apart from the CSG, which is tax deductible in the year of its payment at a rate of 5.1%, these
contributions are not tax deductible.
Relevant shareholders are advised to consult their usual tax advisor to determine the appropriate
methods of declaring the dividends and paying the 21% withholding tax and the applicable social
security contributions, as well as, more generally, the tax regime that will apply to their own situation.
4.11.1.1
Legal entities which are subject to corporate income tax in France (under standard conditions)
Dividends paid by the Company to legal entities who are French tax residents will not, in principle, be
liable to any withholding tax.
However, if the dividends paid by the Company are paid outside France in a NCST, a withholding tax
will apply on dividend payments at a rate of 75%. Shareholders are advised to consult their usual tax
advisor to determine the tax regime that will apply to their own situation.
4.11.1.2
Other shareholders
Shareholders of the Company who are subject to a different tax treatment than those described above, in
particular individuals who deal in securities on a basis that goes beyond simple portfolio management or
who have recorded their shares as assets on their commercial balance sheet, should seek professional
advice from their usual tax advisor as to the tax treatment that will apply to their own situation.
4.11.2
Shareholders who are not resident of France for tax purposes
This sub-section describes the withholding tax regime that could apply, under current French law and
subject to the provisions of double tax treaties, to dividends paid by the Company to individual and
corporate shareholders who (i) are not resident of France for tax purposes within the meaning of Article
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4 B of the FTC or whose registered office is outside France and (ii) do not own the shares through a
fixed place of business or a permanent establishment liable to tax in France. However, such shareholders
should seek advice from their usual tax advisor about the tax treatment that will apply to their own
situation.
Under the French legislation currently in force and subject to the application of any double tax treaty and
the exceptions referred to below, dividends paid by the Company are generally subject to a withholding
tax, levied by the paying agent, when the tax residence or registered office of the beneficial owner is
outside France. Subject to what is stated below, the rate of such withholding tax is:
•
21% when the beneficial owner is an individual whose tax residence is in an EU Member State
or a European Economic Area member state that has signed a tax agreement with France that
contains an administrative assistance clause with a view to combating tax fraud or tax evasion;
•
15% when the beneficial owner is an organization whose registered office is in an EU Member
State or a European Economic Area member state that has signed a tax agreement with France
that contains an administrative assistance clause with a view to combating tax fraud or tax
evasion, and that would, if it had its registered office in France, be taxed in accordance with the
special tax regime set forth in paragraph 5 of Article 206 of the FTC (which refers to organisms
generally referred to as “non-profit organizations” (organismes sans but lucratif)) as construed
by paragraph 580 et seq. of administrative guidelines BOI-IS-CHAMP-10-50-10-40-20130325
and relevant case law; and
•
30% in all other cases.
However, regardless of the beneficial owner's tax residence or place of residence or registered office,
subject to the provisions of any double tax treaties, the dividends paid by the Company outside France in
a NCST will be subject to withholding tax at the rate of 75%. The list of NCSTs is published by decree
and is updated annually.
The withholding tax may be reduced or eliminated, in particular pursuant to (i) Article 119 ter of the
FTC which is applicable, under certain conditions, to corporate shareholders having their effective place
of management in an EU Member State and which hold at least 10% of the Company's capital, (ii)
administrative guidelines BOI-RPPM-RCM-30-30-20-40-20150401, relating to corporations or other
organizations fulfilling the requirements set forth in sections 145 and 216 of the FTC for the application
of the parent-subsidiary regime, whose effective place of management is in an EU Member State or a
European Economic Area member state that has signed a tax agreement with France that contains an
administrative assistance clause with a view to combating tax fraud or tax evasion, and which do not
benefit from a tax credit for the French withholding tax in their country of tax residence, or to (iii)
double tax treaties that may apply.
In addition, the withholding tax is not applicable to dividends paid to certain mutual investment funds
incorporated under the laws of a foreign jurisdiction that (i) are based in an EU Member State or in
another State or territory that has signed a tax agreement with France that contains an administrative
assistance clause with a view to combating tax fraud or tax evasion fulfilling the requirements of Article
119 bis 2 of the FTC, (ii) raise capital from a certain number of investors in order to invest for the
interest of those investors, in accordance with a defined investment policy, and (iii) have characteristics
similar to those required of collective undertakings fulfilling the conditions set forth under Article 119
63
bis 2 of the FTC and in the official bulletin of the Finances Publiques-Impôts BOI-RPPM-RCM-30-3020-70-20130812. Relevant shareholders are advised to consult their usual tax advisor in order to
determine the modalities according to which these provisions may apply to their own situation.
Shareholders are advised to seek professional advice from their usual tax advisor to determine whether
they are likely to be subject to the legislation on NCSTs and/or to be able to claim the right to benefit
from a reduction of or an exemption from the withholding tax, and to define the practical procedures to
be applied therewith, including those set out in administrative guidelines BOI-INT-DG-20-20-20-2020120912 relating to the so-called "standard" and "simplified" procedures for the reduction of and
exemption from withholding tax as regards double tax treaties.
Shareholders that are not resident of France for tax purposes must also comply, in connection with the
dividends paid by the Company, with the tax legislation in force in their state of tax residence, as
amended by any double tax treaty entered into by France and that State.
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5
TERMS AND CONDITIONS OF THE OFFERING
5.1
CONDITIONS, OFFERING STATISTICS, INDICATIVE TIMETABLE AND APPLICATION
PROCEDURE FOR THE OFFERING
5.1.1
Conditions of the Offering
The Offering will consist of (i) up to 8,241,758 New Deezer Shares, and (ii) up to 1,236,264 Existing
Deezer Shares sold by the Selling Shareholders (the “Sale Shares”) in the event of the exercise in full of
the Over-Allotment Option (together, the “Offer Shares”).
It is expected that the initial public offering of the Company’s shares for trading on Euronext Paris will
be structured as a global offering composed of:
•
•
An international offering (the “International Offering”) primarily to institutional investors,
which will be composed of:
o
a private placement in France; and
o
an international private placement in certain other countries, including in the United States
to qualified institutional buyers in reliance on Rule 144A (“Rule 144A”) under the
Securities Act of 1933, as amended (the “Securities Act”), and outside of the United States
in reliance on Regulation S (“Regulation S”) under the Securities Act; and
and a public offering to retail investors in France, made by means of an open price retail offering
(offre à prix ouvert) (the “French Public Offering”).
The shares will be distributed to the public in France in accordance with the provisions of Articles
P 1.2.1 et seq. of Book II of Euronext Paris’ Non-Harmonized Rules relating to specific rules applicable
to French regulated markets. The allocation of the New Deezer Shares between the International
Offering and the French Public Offering will be made according to the nature and significance of
demand, in accordance with the principles set forth in Articles 315-35 of the AMF’s General
Regulations. A minimum of 10% of the number of New Deezer Shares to be offered in the Offering will
be offered in the French Public Offering. Accordingly, if demand in the French Public Offering is
sufficient, the number of shares allocated in response to orders placed in the French Public Offering will
be equal to at least 10% of the number of New Deezer Shares sold in the Offering. If demand in the
French Public Offering is less than 10% of the number of New Deezer Shares to be offered in the
Offering, the remaining Offer Shares not allocated to the French Public Offering will be offered under
the International Offering.
Indicative timetable
Date
Event
October 14, 2015........................................
Visa of the AMF on the Prospectus
October 15, 2015........................................
Press release announcing the Offering and the
procedure by which the Prospectus has been made
available to the public
Publication by Euronext Paris of a notice relating to
the opening of the French Public Offering
65
Opening of the Offering
October 26, 2015........................................
Closing of the French Public Offering at 17:00 (CET)
for subscriptions placed in person and at 20:00(CET)
for subscriptions placed online
October 27, 2015........................................
Closing of the International Offering at 12:00 (CET)
Determination of the Offering Price
Signature of the Underwriting Agreement
Publication by Euronext Paris of a notice relating to
the results of the Offering
Press release announcing the Offering Price and the
results of the Offering
First listing of the Company’s shares on Euronext
Paris
Beginning of the stabilization period
October 28, 2015........................................
Opening of the trading for the New Deezer Shares on
Euronext Paris in the form of when issued shares
(promesses d’actions) (traded under the symbol “DZR
-Promesses” until the settlement date of the
International Offering and the French Public Offering)
October 29, 2015........................................
Settlement date of the Offering
October 30, 2015........................................
Opening of trading of the Deezer Shares on Euronext
Paris under the symbol “DZR”
November 26, 2015....................................
Deadline for the exercise of the Over-Allotment
Option
End of the stabilization period
5.1.2
Amount of the Offering
5.1.2.1
Proceeds of the offering of New Deezer Shares
The gross proceeds of the issuance of the New Deezer Shares are expected to be €300 million.
The net proceeds of the issuance of the New Deezer Shares are expected to be €291 million.
The expenses of the Company in connection with the Offering are estimated to be approximately €8
million.
In the event subscriptions received represent at least 75% of its initial contemplated size, the Offering
size of the share capital increase could be reduced to the amount of the subscription received.
66
5.1.2.2
Proceeds of the offering of Sale Shares
The gross proceeds from the sale of the Sale Shares will be approximately €45 million in the event of the
full exercise of the Over-Allotment Option. The Selling Shareholders will receive the net proceeds from
the sale of the Sale Shares if the Over-Allotment Option is exercised.
5.1.3
Offering period and procedures
5.1.3.1
Principal terms and conditions of the French Public Offering
Duration of the French Public Offering
The French Public Offering will commence on October 15, 2015 and end on October 26, 2015 at 17:00
(Paris time) for subscriptions placed in person at the branches of relevant financial institutions
(souscriptions aux guichets) and 20:00 (Paris time) for subscriptions made via Internet. The closing date
for the Offering may be changed.
Number of shares sold in the French Public Offering
A minimum of 10% of the total number of Offer Shares to be offered in the Offering (excluding exercise
of the Over-Allotment Option) will be offered in the French Public Offering. Accordingly, if demand in
the French Public Offering is sufficient, the number of shares allocated in response to orders placed in
the French Public Offering will be equal to at least 10% of the total number of Offer Shares sold in the
Offering, excluding exercise of the Over-Allotment Option.
The number of shares offered in the French Public Offering may be increased or decreased in accordance
with the terms set forth in Section 5.1.1, “Conditions of the Offering”, of this Securities Note.
Persons eligible to place orders in the French Public Offering
Persons eligible to place orders in the context of the French Public Offering include natural persons of
French nationality, residents of France or of any States party to the Agreement on the European
Economic Area (member states of the European Union, Iceland, Norway and Lichtenstein, together the
“EEA Member States”), mutual funds and legal entities or residents of EEA Member States which are
not, within the meaning of Article L. 233-33 of the French Code of Commerce, under the control of
entities or persons resident in States other than the EEA Member States, as well as associations and
investment clubs domiciled in France or in EEA Member States and whose members are residents of
France or one of the EEA Member States, subject to the terms and conditions set forth in Section 5.2.1,
“Categories of Potential Investors – Jurisdictions of the Offering – Restrictions Applicable the Offering”,
of this Securities Note. Other persons must inform themselves of the local selling restrictions included in
Section 5.2.1, “Categories of Potential Investors – Jurisdictions of the Offering – Restrictions Applicable
the Offering”, of this Securities Note.
Natural persons, legal entities or mutual funds that do not have bank accounts in France which permit
them to acquire shares in the context of the Offering should open an account at a financial intermediary
which is eligible to place orders on their behalf for this purpose.
The subscription order should be executed by the buyer or his/her authorized representative. If the
representative is an asset or investment manager, the relevant manager must:
67
•
have an authorization that includes a specific undertaking by the clients, in the context of
transactions where each investor is authorized to place only one purchaser order, not to place
subscription orders without having requested and received a written confirmation from the
manager to the effect that such manager has not placed a subscription order covering the same
shares pursuant to such authorization; or
•
implement all reasonable procedures with the objective of preventing multiple subscription
orders (for example, by informing the client that the manager has placed a subscription order on
such client’s behalf and accordingly, the client cannot directly place a subscription order of the
same kind without having informed the manager in writing of his/her decision before the
consummation of the transaction so that the manager can cancel the corresponding subscription
order).
Types of orders to be issued in connection with the French Public Offering
Persons wishing to participate in the French Public Offering should place their orders with an eligible
financial intermediary in France, at the latest by October 26 at 17:00 (Paris time) for subscriptions made
in person at the branches of the relevant financial institutions (souscriptions aux guichets) and 20:00
(Paris time) for subscriptions made via Internet.
Pursuant to Article P 1.2.16 of the Euronext rules Book II relating to the specific rules applicable to the
French regulated markets, subscription orders will be categorized by the number of Shares requested:
•
A1 orders: between 10 and 200 shares;
•
A2 orders: more than 200 shares.
The result of the French Public Offering will be published in a notice by Euronext Paris and will indicate
the reduction, if any, applied to the subscription orders. The A1 orders will benefit from preferential
treatment as compared to the A2 orders in the event that all orders cannot be satisfied in their entirety.
It is also specified that:
•
Each subscription order must be in respect of at least 10 shares;
•
A principal may only place one subscription order; this order cannot be divided among multiple
financial intermediaries and must be given to a single financial intermediary;
•
In the case of a joint account, a maximum of two subscription orders can be placed in respect
thereof;
•
Each member of a taxable household can place a subscription order. A subscription order from a
minor will be made by such minor’s legal representative. Each of these orders will benefit from
the advantages that are normally associated with them. If there is a reduction applied to such
subscription orders, such reduction will apply separately to the subscription orders of the
members of the same taxable household;
•
The amount of each subscription order may not be in respect of a number of shares representing
more than 20% of the number of Offer Shares to be offered in the French Public Offering;
•
The subscription orders may be served with a reduction, in accordance with the terms and
conditions set forth below;
68
•
If applying the reduction principles set forth herein would result in a fractional number of
shares, the number of shares attributed will be rounded down to the nearest whole number;
•
The subscription orders will be expressed as a number of shares without an indication of price
and shall be deemed to be made at the Offering Price; and
•
The conditions for withdrawing a subscription order are specified below and in Section 5.3.2,
“Withdrawal of Orders”, of this Securities Note.
Eligible financial intermediaries will transmit the subscription orders to Euronext Paris according to the
calendar and procedures specified in the notice of the opening of the French Public Offering which will
be published by Euronext Paris.
Subscription orders will be null and void if the Company does not publish a press release setting forth
the definitive terms and conditions of the Offering.
Reduction of orders
A1 orders have priority over A2 orders; a rate of reduction of up to 100% may be applied to A2 orders in
order to satisfy A1 orders. In the event that the number of Offer Shares is insufficient to cover the
number of shares requested in the A1 orders, such orders shall be reduced pro rata. Similarly, if the
number of Offer Shares is sufficient to cover the A1 orders but not the A2 orders, the A2 orders shall be
reduced pro rata.
If applying the reduction principles set forth herein would result in a fractional number of shares, the
number of shares attributed will be rounded down to the nearest whole number.
Withdrawal of orders
Subscription orders placed by individuals via Internet in the context of the French Public Offering will
be revocable, via Internet, until the closing of the French Public Offering (October 26, 2015 at 20:00
(Paris time)). Individuals are responsible for liaising with their respective financial intermediaries in
order to confirm whether the orders submitted by other means are revocable and if so under what
conditions (including whether orders submitted via the Internet can be revoked by means other than via
the Internet).
Moreover, the circumstances under which orders may be withdrawn in the case of a modification of the
terms of the French Public Offering, are described in Section 5.3.2.3, "Modifications to the indicative
offering price range”, of this Securities Note. In such case, the new indicative date for the determination
of the indicative price range will be published in a Euronext Paris notice and a press release published
the Company.
Results of the French Public Offering
The results of the French Public Offering will be the announced in a press release and in a notice issued
by Euronext Paris, which are expected to be published on October 27, 2015, except in the case of early
closing, in which case the publication of the press release and the notice by Euronext Paris will occur no
later than the day after the closing of the Offering.
This press release and notice will specify the reduction rate that may be applied to the subscription
orders.
69
5.1.3.2
Principal characteristics of the International Offering
Duration of the International Offering
The International Offering will commence on October 15, 2015 and end on October 27, 2015 at 12:00
(Paris time). In the event that the French Public Offering is extended (for a description of the process for
a modification of the terms of the Offering, see Section 5.3.2, “Publication of the Offering Price and
Modification of the Terms of the Offering”, of this Securities Note), the date of the closing of the
International Offering may also be extended.
The International Offering may be closed early without notice.
Persons eligible to place orders in the International Offering
The International Offering will be principally made to institutional investors in France and outside of
France, including in the United States in reliance on Rule 144A under the Securities Act and outside the
United States in reliance on Regulation S under the Securities Act.
Orders in the International Offering
Subscription orders in the International Offering may be expressed as a number of shares or monetary
amount. They can include conditions relating to the Offering Price.
Receipt and transmittal of orders in the International Offering
All orders placed in the International Offering must be received by one or more of the Joint Bookrunners
no later than October 27, 2015 at 12:00 (Paris time), except in the case of early closing.
Only subscription orders with a price equal to or greater than the Offering Price, expressed in euros, will
be taken into account when allocating shares in the International Offering, under the conditions set forth
in Section 5.3.1, “Price Setting Method”, of this Securities Note.
Reduction of orders
Subscription orders placed in the context of the International Offering may be partially or entirely
reduced.
Any subscription order placed in the context of the International Offering may be withdrawn from the
Joint Global Coordinators and Joint Bookrunners that received the order until October 27, 2015 at 12:00
(Paris time), except in the case of early closing or extension of the duration of the Offering.
Results of the International Offering
The results of the International Offering will be announced in a press release and in a notice issued by
Euronext Paris, which are expected to be published on October 27, 2015, except in the case of early
closing, in which case the publication of the press release and the notice by Euronext Paris will occur no
later than the day after the closing of the Offering.
This press release and notice will specify the reduction rate that may be applied to the subscription
orders.
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5.1.4
Withdrawal or suspension of the Offering
The Offering will be made subject to the Underwriting Agreement (described in Section 5.4.3,
“Underwriting”, of this Securities Note) being signed and not having been terminated prior to the
settlement date of the Offering and the issuance of the certificate of the funds depositary appointed for
the capital increase.
Accordingly, any outstanding subscription orders and the Offering will be retrospectively cancelled in
the event the Underwriting Agreement is not signed. If the Underwriting Agreement is terminated or the
funds depositary certificate is not issued, any outstanding subscription orders and the Offering will be
retroactively cancelled and all trading of shares that may have occurred up to and including the
settlement date will be null and void and will be retroactively unwound.
In particular:
•
the French Public Offering and the International Offering, as well as all of the subscription
orders made in connection therewith, will be null and void retroactively; and
•
all trading in the shares that may have occurred up to and including the settlement date will be
null and void and will be retroactively unwound, with each investor being personally responsible
for its own losses and costs incurred as a result of such cancellation.
If the Underwriting Agreement is not signed or is terminated, or if the funds depositary certificate is not
issued, the Deezer Shares will not be admitted to trading on Euronext Paris.
If the Underwriting Agreement is not signed or is terminated, or if the funds depositary certificate is not
issued, the Company will publish a press release and inform Euronext Paris without delay (at which time
Euronext Paris will publish a notice).
5.1.5
Reduction of orders
See Section 5.1.3, “Offering period and procedures”, of this Securities Note for a description of the
reduction of subscription orders placed in the context of the Offering.
5.1.6
Minimum or maximum number of shares covered by an order
See Section 5.1.3, “Offering period and procedures”, of this Securities Note for a description of the
minimum and maximum number of shares that may be included in a subscription order placed in the
French Public Offering.
There is no such minimum or maximum number for orders placed in the International Offering.
5.1.7
See Sections 5.1.3, “Offering period and procedures” and 5.3.2, “Publication of the Offering Price and
Modifications of the Terms of the Offering”, of this Securities Note for a description of the conditions
for withdrawal of subscription orders placed in the French Public Offering and the International
Offering.
71
5.1.8
Payment of funds and procedures for settlement of Offer Shares
The Offering Price for New Shares that are purchased or subscribed in the context of the Offering shall
be paid in full and in one payment by the relevant purchasers no later than the expected date of
settlement-closing, which according to the indicative timetable, is on October 29, 2015.
The New Deezer Shares will be credited to the accounts of the relevant purchasers as soon as possible
following the dissemination of the results of the Offering by Euronext Paris, which under the indicative
timetable, is from October 27, 2015 and no later than the closing date, which according to the indicative
timetable, is on October 29, 2015.
The settlement of funds paid to the Selling Shareholders in relation to the Sale Shares sold as part of the
exercise of the Over-Allotment Option, is expected to occur no later than the second trading day after the
deadline for the exercise of the Over-Allotment Option, which according to the indicative timetable, is
on November 26, 2015.
5.1.9
Publication of the results of the Offering
The results of the Offering will be announced in a press release and in a notice issued by Euronext Paris
which are expected to be published on October 27, 2015, except in the case of early closing, in which
case the publication of the press release and the notice by Euronext Paris will occur no later than the day
after the closing of the Offering.
5.2
PLAN OF DISTRIBUTION AND ALLOTMENT
5.2.1
Categories of Potential Investors – Jurisdictions of the Offering – Restrictions Applicable
to the Offering
5.2.1.1
Categories of potential investors and jurisdictions of the Offering
It is expected that the initial public offering of the Company’s shares will be structured as a global
offering composed of:
•
•
5.2.1.2
the International Offering primarily to institutional investors, which will be composed of:
o
an offering in France; and
o
private placements in certain other countries, including in the United States to qualified
institutional buyers in reliance on Rule 144A and an offering outside of the United States in
reliance on Regulation S; and
the French Public Offering to retail investors in France.
Restrictions applicable to the offering
The distribution of the Registration Document, this Securities Note, the summary of this Prospectus or
any other document of information relating to the Offering, as well as the sale of Offer Shares, may be
subject to specific regulations in certain countries, including the United States. Individuals or legal
entities in possession of this Prospectus and/or such information must inform themselves of, and comply
with, any local restrictions. Authorized intermediaries may not accept any subscriptions for Offer Shares
from clients whose address is in a country where such restrictions apply, and any such orders received
shall be deemed null and void. Any person (including trustees and nominees) receiving the Registration
Document, this Securities Note, the summary of this Prospectus or any other document of information
72
relating to the Offering may only distribute such documents or make such documents available in
accordance with laws and regulations applicable in the place of distribution or transmission. Any person
who, for any reason, transmits or allows the transmission of the Prospectus to such countries must draw
the attention of the recipient to the terms of this paragraph.
Neither the Registration Document, this Securities Note, nor the Summary of the Prospectus, nor any
other document relating to the Offering constitutes an offer or a solicitation to purchase securities in any
jurisdiction in which it is unlawful to make such an offer or solicitation. The Registration Document,
this Securities Note and the summary of this Prospectus have not been registered outside of France.
Selling restrictions with respect to the United States
The Company’s shares offered hereby have not been and will not be registered under the Securities Act
or the applicable securities laws of any state or other jurisdiction of the United States. Accordingly, the
Company’s shares may not be offered, sold, pledged, delivered, assigned or otherwise transferred in the
United States except pursuant to an applicable exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and in accordance with applicable local securities laws.
The Company’s shares will be sold in the United States only to qualified institutional buyers (“QIBs”) as
defined under Rule 144A under the Securities Act and outside of the United States in “offshore
transactions” in accordance with Regulation S under the Securities Act. Neither this Securities Note, the
Registration Document, the summary of the Prospectus nor any other document related to the Offering in
France may be distributed in the United States. A separate international offering memorandum has been
prepared by the Company for the purpose of the International Offering outside of France. Prospective
investors in the United States may not rely on this Securities Note for any purpose.
Selling restrictions with respect to the EU and the European Economic Area
In relation to each Member State of the European Economic Area, having implemented the Prospectus
Directive (each, a “Member State”), with effect from and including the date on which the Prospectus
Directive has been implemented in that Member State (the “Implementation Date”), an offer to the
public of any of the Company’s shares which are the subject of the Prospectus (“the Shares which are the
subject of the Prospectus”) may not be made in that Member State other than France once the Prospectus
has been approved by the competent authority in France and published in accordance with the
Prospectus Directive, except that offers to the public in those Member States:
•
to legal entities which are qualified investors as defined in the Prospectus Directive;
•
to fewer than 150, natural or legal persons (other than qualified investors as defined in the
Prospectus Directive), as permitted under the Prospectus Directive, subject to obtaining the prior
consent of the other Joint Global Coordinators and Joint Bookrunners for any such offer; or
•
in any other circumstances falling within Article 3(2) of the Prospectus Directive,
provided that no such offer of the Company’s shares which are subject of the Prospectus shall require the
Company or any Underwriter to publish a prospectus pursuant to article 3 of the Prospectus Directive or
supplement a prospectus pursuant to article 16 of the Prospectus Directive.
For the purposes of this provision, the expression an “offer to the public of the Company’s shares” in any
Member State means the communication in any form and by any means of sufficient information on the
terms of the offer and any shares to be offered so as to enable an investor to decide to purchase or
73
subscribe any share, as the same may be varied in that Member State by any measure implementing the
Prospectus Directive in that Member State, the expression “Prospectus Directive” means Directive
2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive), and includes any
relevant implementing measure in each Member State and the expression “2010 PD Amending
Directive” means Directive 2010/73/EU.
This EEA selling restriction is in addition to any other selling restrictions set out in this Prospectus.
Selling restrictions with respect to the UK
This Prospectus and any other material in relation to the Offering described herein is only being
distributed to, and is only directed at persons in the United Kingdom who are qualified investors within
the meaning of Article 2(1)(e) of the Prospectus Directive (“qualified investors”) that are also (i)
investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000
(Financial Promotion) Order 2005 (the “Order”); (ii) high net worth entities or other persons falling
within Article 49(2)(a) to (d) of the Order; or (iii) persons to whom distributions may otherwise lawfully
be made (all such persons together being referred to as “Relevant Persons”) or otherwise in
circumstances which do not require publication by the Company of a prospectus pursuant to section
85(1) of the UK Financial Services and Markets Act 2000 (the “FSMA”). The shares are only available
to, and any investment or investment activity to which this Prospectus relates is available only to, and
will be engaged in only with, Relevant Persons). This Prospectus and its contents are confidential and
should not be distributed, published or reproduced (in whole or in part) or disclosed by recipients to any
other person in the United Kingdom. Persons who are not Relevant Persons should not take any action
on the basis of this Prospectus and should not rely on it.
Selling restrictions with respect to Canada
The Offer Shares may be sold only to purchasers purchasing, or deemed to be purchasing, as principal
that are accredited investors, as defined in National Instrument 45-106 Prospectus Exemptions or
subsection 73.3(1) of the Securities Act (Ontario), and are permitted clients, as defined in National
Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations. Any
resale of the Offer Shares must be made in accordance with an exemption from, or in a transaction not
subject to, the prospectus requirements of applicable securities laws.
Securities legislation in certain provinces or territories of Canada may provide a purchaser with remedies
for rescission or damages if this Prospectus (including any amendment thereto) contains a
misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser
within the time limit prescribed by the securities legislation of the purchaser’s province or territory. The
purchaser should refer to any applicable provisions of the securities legislation of the purchaser’s
province or territory for particulars of these rights or consult with a legal advisor.
Pursuant to section 3A.3 (or, in the case of securities issued or guaranteed by the government of a nonCanadian jurisdiction, section 3A.4) of National Instrument 33-105 Underwriting Conflicts (NI 33-105),
the Underwriters are not required to comply with the disclosure requirements of NI 33-105 regarding
underwriter conflicts of interest in connection with this Offering.
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Selling restrictions with respect to Australia
The Offer Shares have not been and will not be registered in Australia and the Prospectus may not be
distributed in Australia. The Offer Shares may not be offered or sold, directly or indirectly, in Australia
except in certain transactions benefiting from an exemption under Chapter 6D of the Australian
Corporation Act and in accordance with any applicable local securities laws.
Selling restrictions with respect to DIFC
This Prospectus relates to an Exempt Offer in accordance with the Offered Securities Rules of the Dubai
Financial Services Authority (“DFSA”). This Prospectus is intended for distribution only to persons of a
type specified in the Offered Securities Rules of the DFSA. It must not be delivered to, or relied on by,
any other person. The DFSA has no responsibility for reviewing or verifying any documents in
connection with Exempt Offers. The DFSA has not approved this Prospectus nor taken steps to verify
the information set forth herein and has no responsibility for this Prospectus. The shares to which this
Prospectus relates may be illiquid and/or subject to restrictions on their resale. Prospective purchasers of
the shares offered should conduct their own due diligence on the shares. If you do not understand the
contents of this document you should consult an authorized financial advisor.
Selling restrictions with respect to Switzerland
The shares may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange
(“SIX”) or on any other stock exchange or regulated trading facility in Switzerland. This document has
been prepared without regard to the disclosure standards for issuance prospectuses under art. 652a or art.
1156 of the Swiss Code of Obligations or the disclosure standards for listing prospectuses under art. 27
ff. of the SIX Listing Rules or the listing rules of any other stock exchange or regulated trading facility
in Switzerland. Neither this Prospectus nor any other offering or marketing material relating to the shares
or the offering may be publicly distributed or otherwise made publicly available in Switzerland.
Neither this Prospectus nor any other offering or marketing material relating to the offering, the
Company or the shares have been or will be filed with or approved by any Swiss regulatory authority. In
particular, this Prospectus will not be filed with, and the offer of shares will not be supervised by, the
Swiss Financial Market Supervisory Authority FINMA (FINMA), and the offer of shares has not been
and will not be authorized under the Swiss Federal Act on Collective Investment Schemes (“CISA”).
The investor protection afforded to acquirers of interests in collective investment schemes under the
CISA does not extend to acquirers of shares.
South Africa
The Offer Shares may not be and, accordingly, are not being offered or sold to prospective investors in
the Republic of South Africa in a manner that would constitute a public offer as defined in Section 99 of
the Companies Act, No. 71 of 2008 (as amended).
5.2.2
Intentions to Subscribe by Deezer S.A.’s Principal Shareholders, Members of its
Principal Administrative, Executive and Supervisory Bodies or Anyone Intending to
Subscribe for more than 5 per cent. of the Share Capital
None.
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5.2.3
Pre-Allotment Information
See Section 5.1.1, “Conditions of the Offering” and 5.1.3, “Offering Period and Procedures”, of this
Securities Note.
5.2.4
Notification to Investors
Investors in the French Public Offering will be notified of their allocations of Offer Shares by their
authorized financial intermediary.
Investors in the International Offering will be notified of their allocations of Offer Shares by the Joint
Global Coordinators after consultation with the Joint Bookrunners.
5.2.5
Over-Allotment Option
The Selling Shareholders will grant the Stabilizing Manager (as defined in Section 6.5 of this Securities
Note, on behalf of the Underwriters, an option to purchase existing shares representing up to 15% of the
New Deezer Shares in the Offering (i.e., up to 1,236,264 shares based on the lower end of the indicative
offering price range) at the Offering Price.
The Over-Allotment Option may be exercised at the Offering Price by the Stabilizing Manager, on
behalf of the Underwriters, in whole or in part on one occasion at any time during a period of 30 days
following the date of determination of the Offering Price, or up to and including November 26, 2015 at
the latest based on the indicative timetable set forth herein, solely to cover over-allotments, if any, in the
Offering, and to facilitate stabilization activities, if any.
In the event that the Over-Allotment Option is exercised, the Company will announce its exercise by the
Stabilizing Manager to the public in a press release.
5.3
PRICING
5.3.1
Price Setting Method
5.3.1.1
The Offering Price
The price of the Offer Shares will be the same in the French Public Offering and the International
Offering (the “Offering Price”).
It is expected that the Offering Price will be determined on October 27, 2015 according to the indicative
timetable set forth herein. This date may be delayed depending on market conditions and/or in the event
that the results of the book building process do not permit the fixing of the Offering Price on such date.
The date of determination of the Offering Price may be earlier in the event of an early closing of the
French Public Offering or International Offering, or may be delayed in the event of an extension of the
French Public Offering or International Offering.
The Offering Price will be determined taking into account the amount of Deezer Shares offered in the
Offering and the demand for Deezer Shares from investors during the book building process, as such
term is understood in the marketplace (usages professionnels).
The allocation of Deezer Shares will be based on market criteria, and in particular:
•
the ability of investors to ensure the orderly development of a secondary market for the
Company’s shares;
76
•
the order in which subscription orders are received from investors;
•
the amount subscribed for; and
•
the price sensitivity of requests from the investors.
5.3.1.2
The Indicative Offering Price Range
The indicative offering price range for the Offering is between €36.40 and €49.24 per share, as decided
by the Board of Directors of the Company. The indicative offering price range may be modified at any
time up to and including the date of the determination of the Offering Price.
THE INDICATIVE OFFERING PRICE RANGE IS GIVEN SOLELY FOR INFORMATIONAL
PURPOSES AND SHOULD NOT IN ANY EVENT BE CONSIDERED AN INDICATION OF
THE ACTUAL OFFERING PRICE, WHICH MAY BE SET OUTSIDE OF THE INDICATIVE
OFFERING PRICE RANGE.
This indicative offering price range was set by the board of directors of the Company with reference to
the market conditions as of October 13, 2015. In the event that the Offering Price is set outside of the
indicative offering price range, investors should refer to Section 5.3.2, “Publication of the Offering Price
and Modifications of the Terms of the Offering”, of this Securities Note.
5.3.2
Publication of the Offering Price and Modifications of the Terms of the Offering
5.3.2.1
Pricing Date of the Offering
It is expected that the Offering Price will be set on October 27, 2015 based on the indicative timetable.
This date may be delayed depending on market conditions and/or in the event that the results of the book
building process do not permit the fixing of the Offering Price on such date (see Section 5.3.2.4, “Early
Closing and Extension of the Offering”, of this Securities Note).
5.3.2.2
Publication of the Offering Price and the Number of New Deezer Shares
The Offering Price and the number of New Deezer Shares admitted to trading on Euronext Paris will be
announced in a press release from the Company and a notice published by Euronext Paris. These notices
are expected to be published on October 27, 2015 based on the indicative timetable, except in the case of
early closing, in which case the publication of the press release and the notice by Euronext Paris will
occur no later than the day after the pricing date of the Offering.
5.3.2.3
Modifications to the Indicative Price Range
Modifications giving rise to a right of revocation of subscription orders placed in the context of the
French Public Offering.
In the event that the upper limit of the indicative offering price range is increased, or in the event that the
Offering Price is set above the upper limit of the initial or, if applicable, amended indicative offering
price range, the following procedures will apply:
•
Publication of the changes. The revised terms and conditions of the Offering will be disclosed
in a press release from the Company and a notice published by Euronext Paris. The press
release and the notice from Euronext Paris will set forth the new indicative offering price range
77
and, if applicable, the new timetable, including the new closing date of the French Public
Offering, the new date of determination of the Offering Price and the new closing and
settlement date of the Offering.
•
Closing date of the French Public Offering. In the event that the upper limit of the indicative
offering price range is increased, or in the event that the Offering Price is set above the upper
limit of the initial or, if applicable, amended indicative offering price range, the closing date of
the French Public Offering will be delayed or a new subscription period for the French Public
Offering will be opened, as applicable, such that there are at least two market days between the
publication of the press release announcing the changes and the closing date of the French
Public Offering.
•
Revocability of subscription orders in the French Public Offering. Subscription orders received
in the context of the French Public Offering prior to the publication of the press release will be
maintained unless they are expressly revoked prior to or on the new closing date of the French
Public Offering. New subscription orders may be received up to and including the new closing
date of the French Public Offering, and the terms and conditions applicable to the revocability
of such orders are described in Section 5.1.3.1, “Principal Terms and Conditions of the
Offering”, of this Securities Note.
Modifications that do not give rise to a right to revoke subscription orders placed in the context of the
French Public Offering: setting of the Offering Price below the lower limit of the indicative offering
price range below the lower limit of the indicative offering price range or lowering the lower limit of the
indicative offering price range.
The Offering Price may be set below the lower limit of the indicative offering price range and the lower
limit of the indicative offering price range can be lowered. So long as the change does not have a
material effect on the other characteristics of the Offering, the public may be notified of the Offering
Price or the new lower limit of the indicative offering price range in the conditions described in Section
5.3.2.2, “Publication of the Offering Price and the Number of Deezer Shares Offered”, of this Securities
Note.
Thus, in the event that the Offering Price is set below the lower limit of the indicative offering price
range or in the event that the lower limit of the indicative offering price range is revised downwards, and
such action does not have a material impact on the other characteristics of the Offering, the public will
be notified of the Offering Price in a press release from the Company and a notice published by Euronext
which are expected to be released on October 27, 2015 based on the indicative timetable, except in the
case of early closing. as set forth in Section 5.3.2.2, “Publication of the Offering Price and the Number
of Deezer Shares Offered”, of this Securities Note.
However, in the event the Offering Price is set below the lower limit of the indicative offering price
range, or if the lower limit of the indicative offering price range is revised downwards, and such action
has a significant impact on the other characteristics of the Offering, the procedures set forth in Section
5.3.2.5, of this Securities Note will apply.
The number of Deezer Shares offered likewise may be modified freely so long as the modification does
not have a material impact on the other characteristics of the offering. Otherwise, the procedures set
78
forth in Section 5.3.2.5, “Material Modifications of the Terms of the Offering”, of this Securities Note
will apply.
5.3.2.4
Early Closing or Extension of the Offering
The closing dates of the French Public Offering and the International Offering may be accelerated
(provided that the French Public Offering may not be open for less than three market days) or delayed
under the following conditions:
•
If the closing date is earlier than anticipated, the new closing date will be announced in a press
release from the Company and a notice published by Euronext Paris no later than the day before
the new closing date.
•
If the closing date is later than expected, the new closing date will be announced in a press
release from the Company and a notice published by Euronext Paris. In this case, the
subscription orders received in the context of the French Public Offering prior to the press
release from the Company and the notice published by Euronext Paris will be maintained unless
they are expressly revoked prior to or on the new closing date of the French Public Offering.
5.3.2.5
Material Modifications of the Terms of the Offering.
In the event that material modifications are made to the initial terms and conditions set for the offering
that are not described in this Securities Note, a complementary note to this Prospectus will be submitted
for a visa from the AMF. Subscription orders received in the context of the French Public Offering and
the International Offering will be null and void if the AMF does not grant a visa on this complementary
note to the Prospectus. Otherwise, subscription orders placed prior to the grant of a visa on the
complementary note by the AMF may be revoked for at least two market days following the availability
of the complementary note.
5.3.3
Restriction or elimination of Preferential Subscription Rights
The New Deezer Shares are issued pursuant to the 7th resolution of the extraordinary general meeting of
the shareholders of the Company of October 9, 2015, authorizing a capital increase in cash by way of a
public offering, with cancellation of the preferential subscription rights (See Section 4.6
“Authorizations” of this Securities Note).
5.3.4
Price Differentials
Major Warrants
Between July 31, 2008 and June 30, 2011, different categories of warrants, with different exercises
prices, have been issued to the benefit of Warner, Sony, EMI and Universal (the “Majors”) at the level of
Blogmusik (former wholly-owned subsidiary of the Company (see Section 5.1.6, “Reorganization
Transactions”, of the Registration Document). In the context of the completion of the reorganization
transaction dated September 4, 2015 (see Section 5.1.6, “Reorganization Transactions”, of the
Registration Document), such categories of warrants have been amended and restated, in order to adjust
the historical investment conditions of the Majors at the level of Blogmusik with those of the
shareholders at Company’s level as set forth in the provisions of the shareholders’ agreement.
79
In addition, the extraordinary general meeting of the shareholders of the Company dated September 4,
2015 decided the issuance of warrants to the benefit of the Majors with an exercise price of €161.91 (see
Section 21.1.4.1, “Warrants”, of the Registration Document), the purpose of which was to neutralize the
dilution of their participating interests resulting from the exercise by Orange of its warrants, in
accordance with the anti-dilution provided for in the existing shareholders’ agreement, which will be
terminated as from the date of closing of the Offer (see Section 18.4, “Shareholders’ Agreements”, of the
Registration Document).
Orange Warrants
The extraordinary general meeting of the shareholders of the Company dated December 2, 2010 decided
the issuance of 35,132 warrants (as amended) with an exercise price equal to the nominal value of the
shares, exercisable at any time between October 1, 2012 and November 15, 2012 (phase 1), and between
September 1, 2015 and October 15, 2015 (phase 2), each giving right to subscribe to a maximum of one
Class B Share (the “Orange Warrants”). The number of exercisable Orange Warrants depended directly
on Group’s revenues directly generated pursuant to the commercial partnership with Orange. On
September 4, 2015, Orange was enabled to exercise 21.633 Orange Warrants (prior to the Stock Split), in
consideration for an exercise price per warrants equal to the nominal value of the shares of the Company
(prior to the Stock Split), the remainder being cancelled.
5.4
PLACEMENT AND UNDERWRITING
5.4.1
Details of the Joint Global Coordinators and Joint Bookrunners
Joint Global Coordinators
BNP PARIBAS
16, boulevard des Italiens
75009 Paris
France
Merrill Lynch International
2 King Edward Street
London EC1A 1 HQ
United Kingdom
Joint Bookrunners
Citigroup Global Markets Limited
Citigroup Centre
Canada Square
London E14 5LB
United Kingdom
Société Générale
29 Boulevard Haussmann
80
75009 Paris
France
5.4.2
Securities Services and Depositary
Administration and paying agent services in respect of Deezer Shares will be provided by:
BNP Paribas Securities Services
5.4.3
Underwriting
The Offering will be made pursuant to the terms of an underwriting agreement relating to the Offer
Shares (the “Underwriting Agreement”) between the Company, certain Selling Shareholders, BNP
PARIBAS and Merrill Lynch International, as joint global coordinators and joint bookrunners (the “Joint
Global Coordinators”), and Citigroup Global Markets Limited and Société Générale, as joint
bookrunners (the “Joint Bookrunners” and, together with the Joint Global Coordinators, the
“Underwriters”).
The Underwriters will each undertake, severally but not jointly, to procure purchasers for and, failing
which, to purchase themselves a certain number of New Deezer Shares at the Offering Price as of the
closing and settlement date of the Offering.
The Underwriting Agreement does not constitute a performance guarantee (garantie de bonne fin) within
the meaning of Article L. 225-145 of the Commerce Code.
The Underwriting Agreement is expected to be signed on the same day as the determination of the
Offering Price, which is expected to be October 27, 2015 based on the indicative timetable.
The Underwriting Agreement may be terminated by the Underwriters under certain conditions at any
time up to and including the settlement and closing date of the Offering. The circumstances under which
the Underwriting Agreement may be terminated include a breach by the Company or the Selling
Shareholders party thereto of any representations, warranties or undertakings in the Underwriting
Agreement, failure to satisfy certain typical conditions precedent to the Offering, an event or
circumstance having a material adverse effect on the business or prospects of the Company or the Group,
or certain unfavorable changes in market conditions, particularly in France, the United States or the
United Kingdom (including the suspension of securities settlement, payment or clearance services,
moratorium on commercial banking activities, outbreak or escalation of hostilities or acts of terrorism, or
other national or international calamity or crisis), that make it, in the good faith judgment of the Joint
Global Coordinators, impracticable or inadvisable to proceed with the Offering, on the terms and in the
manner contemplated.
In the event that the Underwriting Agreement is not executed, the Offering, as well as all buy orders
placed in its respect, will be cancelled retroactively. In the event that the Underwriting Agreement is
terminated in accordance with its terms and conditions the Offering, including all transactions relating to
the shares executed up to and including the settlement-delivery date will be cancelled retroactively and
unwound. Each individual investor will personally assume its own losses or costs resulting from such
cancellation.
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In the event that the Underwriting agreement is not signed or is terminated in accordance with its terms,
it will be announced in a press release published by the Company and a notice published by Euronext
Paris.
5.4.4
Lock-up Agreements
The applicable lock-up agreements related to the Offering are described in Section 7.3, “Lock-Up
Agreements”, of this Securities Note.
5.4.5
Date of the Underwriting Agreement and Settlement Date of the Offering
According to the indicative timetable, the Underwriting Agreement will be signed on the date of the
determination of the Offering Price, expected to occur on October 27, 2015, and the settlement date of
the Offering is expected to occur on October 29, 2015.
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6
ADMISSION TO TRADING AND DEALING ARRANGEMENTS
6.1
ADMISSION TO TRADING
Application has been made to compartment A or B of Euronext Paris for (i) all of the 16,053,559 Existing
Deezer Shares to be listed and admitted to trading on the regulated market of Euronext Paris, and (ii) up
to 8,241,758 New Deezer Shares, to be listed and admitted to trading on the regulated market of
Euronext Paris.
The conditions under which the Deezer Shares are to be traded will be set forth in a Euronext notice to
be published no later than the first day of trading of the Deezer Shares, on or around October 27, 2015
according to the indicative timetable.
From October 28, 2015 and up to (and including) the settlement date of the Offering, which is expected
to occur on October 29, 2015 according to the indicative timetable, trading for the New Deezer Shares
(in the form of when-issued shares (promesses d’actions) within the meaning of Article L. 228-10 of the
Commercial Code) will be made under the symbol “DZR - Promesses” and will be subject to the
condition precedent of the issuance of the depository certificate relating to the issuance of the New
Deezer Shares.
Beginning on October 30, 2015, the Deezer Shares will trade under the symbol “DZR”.
As of the date of this Prospectus, no other applications for admission of shares onto a regulated market
have been made or are planned by the Company.
6.2
OTHER STOCK EXCHANGES
As of the date of this Prospectus, the Company’s shares are not admitted for trading on any other
regulated or unregulated securities market.
6.3
SIMULTANEOUS OFFERINGS OF SHARES
Not applicable.
6.4
LIQUIDITY AGREEMENT COVERING DEEZER SHARES
None.
6.5
STABILIZATION
Pursuant to the Underwriting Agreement described in Section 5.4.3, “Underwriting”, of this Securities
Note, BNP PARIBAS (or any entity acting on its behalf), acting as stabilizing manager (the “Stabilizing
Manager”) on behalf of the Underwriters, may (but is under no obligation to) carry any and all
stabilization operations deemed useful aiming to support the Company’s share price in accordance with
applicable laws and regulations, in particular EC Commission Regulation No. 2273/2003 of December
22, 2003 implementing Directive 2003/06/EC of the European Parliament and Council of January 28,
2003 on insider trading and market manipulation (the “European Regulation”). There is, however, no
obligation on the Stabilizing Manager to undertake such transactions and such transactions, if
commenced, may be discontinued at any time and without warning.
Stabilization transactions are intended to maintain stabilize or support the market price of the Deezer
Shares and may support a price higher than that which might otherwise prevail in the open market. In the
83
event that the Stabilizing Manager undertakes stabilization transactions, such transactions may take
place at any time during 30 calendar days following the determination of the Offering Price, or any time
between October 27, 2015 and November 26, 2015, according to the indicative timetable.
The Stabilizing Manager will ensure that the public and the competent market regulators are informed in
accordance with Article 9 of the European Regulation and Article 631-10 of the AMF’s General
Regulations.
The Joint Global Coordinators, on behalf of the Underwriters, may decide to over-allot up to the number
of shares covered by the Over-Allotment Option increased, as the case may be, by a number of shares
representing 5% of the aggregate amount of the Global Offering, in accordance with Article 11 of the
European Regulation. In compliance with Article 10-1 of the European Regulation, stabilization
transactions may not be effected at a price greater than the Offering Price.
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7
SELLING SHAREHOLDER
7.1
IDENTIFICATION OF SELLING SHAREHOLDERS
DC Music Sàrl, Idinvest Partners and CM-CIC Capital Privé hold respectively 10.4%, 10.3% and 4.2%
of the share capital of the Company (including shares that may be issued upon exercise of certain
warrants, see Section 9.3 “Allocation of share capital and voting rights”, of this Securities Note).
As of the date of this Prospectus, Mr. Daniel Marhely, Mr. Thomas Erhel and Mr. Xavier Niel hold
respectively 8.4%, 0.6% and 4.0% of the share capital of the Company (including shares that may be
issued upon exercise of certain warrants, see Section 9.3 “Allocation of share capital and voting rights”,
of this Securities Note).
(DC Music Sàrl, Idinvest Partners and CM-CIC Capital Privé, Mr. Daniel Marhely, Mr. Thomas Erhel
and Mr. Xavier Niel are together defined as the “Selling Shareholders”).
7.2
NUMBER AND CLASS OF SECURITIES OFFERED BY THE SELLING SHAREHOLDERS
In the context of the Offering, the Selling Shareholders undertook to offer up to 1,236,264 Sale Shares
(based on the lower end of the indicative offering price range and assuming full exercise of the OverAllotment Option).
The Sale Shares are ordinary shares at par value €0.01, fully subscribed and paid up.
7.3
LOCK-UP AGREEMENTS
Company lock-up
Note, the Company has agreed not to, without the prior written consent of the Joint Global Coordinators,
issue, offer, sell, pledge, announce the intention to sell, sell any option or contract to purchase, purchase
any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or
dispose of, directly or indirectly, any shares or other securities that are substantially similar to the Deezer
Shares, or any securities that are convertible or redeemable into or exchangeable for, or that represent the
right to receive, shares of the Company or any such substantially similar securities, or enter into any
derivative or other transaction having substantially similar economic effect with respect to its shares or
any such securities, during the period beginning from the date of the Underwriting Agreement and
continuing to and including the date 360 days after the date of settlement-closing date of the Offering.
This agreed restriction is subject to various exceptions, including:
(i)
the issuance of the New Deezer Shares;
(ii)
shares that may be issued, offered or sold to the Company’s employees, or to employees
of its affiliates (to the extent applicable), in the context of an existing plan authorised by
the Company’s general meeting of shareholders as of the date of the Underwriting
Agreement or in the context of a future plan to be authorised by the Company’s general
meeting of shareholders; and
(iii)
shares that may be issued upon the exercise or conversion of instruments existing a as of
the date of the Underwriting Agreement and described in the Offering Documents.
85
Selling Shareholder lock-up
Note, each Selling Shareholder has agreed (with certain exceptions, as described below) not to, without
the prior written consent of the Joint Global Coordinators, issue, offer, sell, pledge, announce the
intention to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase or otherwise transfer or dispose of, directly or indirectly, any shares
of the Company or other securities that are substantially similar to the Deezer Shares, or any securities
that are convertible or redeemable into or exchangeable for, or that represent the right to receive, shares
or any such substantially similar securities, or enter into any derivative or other transaction having
substantially similar economic effect with respect to its shares or any such securities, during the period
beginning from the date of the Underwriting Agreement and continuing to and including the date 180
days after the date of settlement-closing date of the Over-Allotment Option. This agreed restriction is
subject to various exceptions, including: in each case,
(i)
the sale of the Sale Shares in the Offering; and
(ii)
the transfer of shares to an affiliate of such Selling Shareholder (to the extent applicable),
subject to such transferee agreeing to be bound by the above restriction.
Company officer and employee lock-up
Each shareholder that is an officer or employee of the Company (with certain exceptions) has agreed, ,
subject to certain exceptions, with the Underwriters not to, without the prior written consent of the Joint
Global Coordinators, issue, offer, sell, announce the intention to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or
otherwise transfer or dispose of, directly or indirectly, any shares of the Company or other securities of
the Company that are substantially similar to the shares of the Company, or any securities that are
convertible or redeemable into or exchangeable for, or that represent the right to receive, shares of the
Company or any such substantially similar securities of the Company, or enter into any derivative or
other transaction having substantially similar economic effect with respect to its shares of the Company
or any such securities for a period of 360 days following the settlement-closing date of the Offering.
Non-selling shareholder lock-up
Each Company shareholder prior to the closing date of the Offering that is not subject to a lock-up
described above has agreed, subject to certain exceptions, with the Underwriters not to, without the prior
written consent of the Joint Global Coordinators, issue, offer, sell, pledge, announce the intention to sell,
sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase or otherwise transfer or dispose of, directly or indirectly, any shares of the Company
or other securities of the Company that are substantially similar to the shares of the Company, or any
securities that are convertible or redeemable into or exchangeable for, or that represent the right to
receive, shares or any such substantially similar securities of the Company, or enter into any derivative
or other transaction having substantially similar economic effect with respect to its shares or any such
securities for a period of 180 days following the settlement-closing date of the Offering.
86
EXPENSES RELATED TO THE OFFERING
8
The expected proceeds of and expenses related to the Offering, in each case based on an Offering Price
at the lower end of the indicative offering price range, are as follows:
Issuance of New Deezer Shares
•
The gross proceeds of the issuance of New Deezer Shares are expected to be approximately
€300 million.
•
The net proceeds to the Company of the issuance of New Deezer Shares are expected to be
•
The expenses of the Company for the Offering are expected to be approximately €8 million.
Sale of Sale Shares
•
The gross proceeds of the sale of Sale Shares are expected to be approximately €45 million.
•
The Selling Shareholders will receive the net proceeds from the sale of Sale Shares if the OverAllotment Option (as defined below) is exercised.
87
9
DILUTION
9.1
IMPACT OF THE OFFERING ON THE PROPORTION OF EQUITY HELD BY A SHAREHOLDER
(in euros per share)
Consolidated equity per ordinary share as of
June 30, 2015
Prior to the issuance of the New Deezer Shares
0.18 euros
Following the issuance of up to 8,241,758 New 12.46 euros
Deezer shares (based on the lower end of the
indicative offering price range)
9.2
AMOUNT AND PERCENTAGE OF DILUTION RESULTING IMMEDIATELY FROM THE OFFERING
(in %)
Consolidated equity per ordinary share as of
June 30, 2015
Prior to the issuance of the New Deezer Shares
1.00%
Following the issuance of up to 8,241,758 New 0.66%
Deezer shares (based on the lower end of the
indicative offering price range)
9.3
ALLOCATION OF SHARE CAPITAL AND VOTING RIGHTS
As of the date of this Prospectus, the Company is not controlled by any majority shareholder and the
Company’s share capital is €128,535.25 divided into 12,853,525 Existing Deezer Shares of par value
€0.01, fully subscribed and paid up.
Assuming that (i) all classes of shares have been converted into ordinary shares1, and (ii) all outstanding
warrants have been exercised on or prior to the settlement date of the Offering on the regulated market of
Euronext Paris subject to a settlement before December 31, 2015 (other than the Warrants07/09 held by
Mr. Marc Oiknine, which the Company does not expect to be exercised on or prior to the settlement date
of the Offering of the Company’s shares on the regulated market of Euronext Paris), the Company’s nondiluted share capital prior to the closing date of the Offering would be equal to €160,535.59, divided into
16,053,559 shares, par value €0.01, fully subscribed and paid-up, allocated as follows:
The following tables do not reflect the shares underlying the existing outstanding stock options held by
certain officers and employees of the Company and the warrants held by Mr. Marc Oiknine.
1
Upon the date of the determination of the Offering Price (October 27, 2015 according to the indicative timetable), in accordance with the
provisions of article 10.2.1 of the current bylaws of the Company, the class A preferred shares (the “Class A Shares”) and the class B
preferred shares (the “Class B Shares”) shall be automatically converted into ordinary shares and: (a) the conversion ratio applicable to Class
A Share shall be either (i) one ordinary share for every one Class A Share if the Offering Price per share is above an amount corresponding
to the issuance price of the Class A Shares (plus a minimum return over holding period), or (ii) above one ordinary share for every one Class
A Shares if the Offering Price per share is below such amount; and (b) the conversion ratio applicable to Class B Share shall be one ordinary
share for every one Class B Share, in any case. As the lower range of the Offering Price is above the amount corresponding to the issuance
price of the Class A Shares (plus a minimum return over holding period), the conversion ratio of the Class A Shares will be one ordinary
share for every one Class A Share.
88
Shareholders
Number of shares
% of share capital (non-diluted)
110,403
1,344,092
104,052
643,539
1,669,472
1,649,143
676,280
1,870,906
4,763,830(3)
439,669(5)
664,680
664,680
332,311
1,032,052
66,700
21,750
16,053,559(6)
0.7%
8.4%
0.6%
4.0%
10.4%
10.3%
4.2%
11.7%
29.7%
2.7%
4.1%
4.1%
2.1%
6.4%
0.4%
0.1%
100%
Jonathan Benassaya
Daniel Marhely
Thomas Erhel
Xavier Niel
DC Music Sàrl (1)
Idinvest Partners
MIH(4)
Warner
Sony
EMI
Universal
Didier Bench
Former employees
Total
________
(1) DC Music Sàrl is the special investment vehicle Dotcorp Private Equity Fund III of the Rosenblum brothers (founders of e-commerce
company, Pixmania).
(2) The direct shareholder of Access Industries is AI European Holdings Sàrl of which the beneficial owner is Mr. Len Blavatnik.
(3) This table reflects (i) the exercise by Mr. Simon Baldeyrou on the date of the determination of the Offering Price of his call option giving the
right to purchase 43.500 shares from other several shareholders (such call option having no dilutive impact), and (ii) the sale of such 43.500
shares by Mr. Simon Baldeyrou to Access Industries at a price equal to the Offering Price on the date of the determination of the Offering Price.
(4) MIH is a subsidiary of Prosiebensat 1 Media AG.
(5) This figure reflects the number of exercisable warrants held by MIH on the basis of the lower end of the indicative offering price range.
(6) Includes 3,200,034 newly-issued shares pursuant to the expected exercise of 1,919,133 warrants (on or prior to the settlement date of the
Offering by the relevant holders thereof (which warrants would otherwise lapse as of such settlement)). As of the date of this Prospectus, the
Company has received notice from the relevant holders of 1,570,553 warrants of their exercise, subject to a settlement before December 31,
2015. The aggregate proceeds from the exercise of such warrants based on their strike prices and other relevant terms and conditions would be
approximately €12 million. It is expected that the warrants held by Sony will be exercised as their average exercise price is €7.9.
Assuming all outstanding stock options and warrants were exercised prior to the settlement date of the
Offering, the total number of ordinary shares outstanding would be 17,120,179 shares (24.9% of the
fully diluted share capital of the Company as of the date of this Prospectus).
As at closing of the Offering, and after the issuance of the maximum number of 8,241,758 New Deezer
Shares sold at the lower end of the indicative offering price range, the shareholding structure of the
Company would be as follows.
Shareholders
Shareholding (excluding exercise of the OverAllotment Option)
Number of shares
Jonathan Benassaya
Daniel Marhely
Thomas Erhel
Xavier Niel
DC Music Sàrl
Idinvest Partners
Access Industries
MIH
Warner
Sony
EMI
Universal
Didier Bench
Public
Total
% of share capital
110,403
1,344,092
104,052
643,539
1,669,472
1,649,143
676,280
1,870,906
4,763,830
439,669
664,680
664,680
332,311
1,032,052
66,700
8,263,508
24,295,317
0.5%
5.5%
0.4%
2.6%
6.9%
6.8%
2.8%
7.7%
19.6%
1.8%
2.7%
2.7%
1.4%
4.2%
0.3%
34.0%
100%
89
Shareholding (assuming full exercise of the
Over-Allotment Option)
Number of shares
110,403
1,071,089
82,918
512,828
1,330,380
1,314,180
538,919
1,870,906
4,763,830
439,669
664,680
664,680
332,311
1,032,052
66,700
9,499,772
24,295,317
% of share capital
0.5%
4.4%
0.3%
2.1%
5.5%
5.4%
2.2%
7.7%
19.6%
1.8%
2.7%
2.7%
1.4%
4.2%
0.3%
39.1%
100%
As at closing of the Offering, and after the issuance of the maximum number of 6,092,608 New Deezer
Shares sold at the higher end of the indicative offering price range, the shareholding structure of the
Company would be as follows:
Shareholders
Shareholding (excluding exercise of the OverAllotment Option)
Number of shares
Jonathan Benassaya
Daniel Marhely
Thomas Erhel
Xavier Niel
DC Music Sàrl
Idinvest Partners
Access Industries
MIH
Warner
Sony
EMI
Universal
Didier Bench
Public
Total
% of share capital
110,403
1,344,092
104,052
643,539
1,669,472
1,649,143
676,280
1,870,906
4,763,830
406,174
664,680
664,680
332,311
1,032,052
66,700
6,114,358
22,112,671
0.5%
6.1%
0.5%
2.9%
7.5%
7.5%
3.1%
8.5%
21.5%
1.8%
3.0%
3.0%
1.5%
4.7%
0.3%
27.7%
100%
90
Shareholding (assuming full exercise of the
Over-Allotment Option)
Number of shares
110,403
1,142,278
88,429
546,913
1,418,803
1,401,526
574,738
1,870,906
4,763,830
406,174
664,680
664,680
332,311
1,032,052
66,700
7,028,249
22,112,671
% of share capital
0.5%
5.2%
0.4%
2.5%
6.4%
6.3%
2.6%
8.5%
21.5%
1.8%
3.0%
3.0%
1.5%
4.7%
0.3%
31.8%
100%
10
ADDITIONAL INFORMATION
10.1
ADVISERS WITH AN INTEREST IN THE OFFERING
Not applicable.
10.2
OTHER INFORMATION VERIFIED BY THE STATUTORY AUDITORS
Not applicable.
10.3
EXPERT’S REPORT
Not applicable.
10.4
INFORMATION SOURCED FROM THIRD PARTIES
Except as disclosed in particluar in Section 23, “Third Party Information and Statement by Experts and
Declaration of any Interest,” of the Registration Document no information contained in the Prospectus
has been sourced from a third party.
91
11
UPDATE OF THE REGISTRATION DOCUMENT
11.1
RISKS RELATED TO DEEZER’S BUSINESS AND INDUSTRY
With respect to the risk factor included in Section 4.1.7.3 of the Registration Document, “Changes in tax
treatment of companies engaged in e-business may adversely affect the commercial use of Deezer’s sites
and financial results”, the following noticeable developments should be noted.
On October 5, 2015, the OECD issued its final Base Erosion and Profit Shifting (BEPS) action plan for a
coordinated international approach to combat tax avoidance. The first item of such action plan addresses
the tax challenges of the digital economy (in particular questions relating to the allocation of profits and
value-added among various jurisdictions, the inadequacy of concepts of source and residence and certain
other income characterization issues), with a view to better aligning taxation with the location in which
economic activities take place.
Agreed measures include the amendment of the definition of permanent establishment included in tax
treaties and of the transfer pricing guidance to take into account the peculiarities of the digital economy.
Such measures are designed to be implemented via changes in domestic law and regulations and in
published OECD transfer pricing guidelines, as well as through a multilateral treaty instrument currently
being negotiated between 88 countries and expected to be finalized by the end of 2016. Some of these
measures (in particular transfer pricing guidelines) are intended to be immediately applicable. On
October 8, 2015, the Ministers of Finance of the G20 Member States expressed their strong support for
those measures and renewed a commitment for their rapid, widespread and consistent implementation.
Although not endorsed as agreed measures, the OECD panel has also discussed and analyzed certain
options to address the VAT issues raised by the digital economy, leaving it to the various states to decide
whether to introduce such safeguards in their domestic legislation.
Such measures are likely to result in additional tax costs and to increase the cost of doing business online
and could adversely affect Deezer’s business, results of operations or financial condition.
11.2
DESCRIPTION OF DEEZER’S BUSINESS
Section 6.5.1.2 “Premium+ service offering” of the Registration Document is completed with the
following information.
In October 2015, Deezer announced the launch of its “Deezer Football” service, which allows users to
stream live commentary on Premier League and Bundesliga football matches from talkSPORT and
SPORT1.fm, as well as football podcasts. The service is available on mobile and desktop in the United
Kingdom to both Premium subscribers and users of the free advertising-based service.
Deezer also launched a broad-ranging partnership with BandPage, an online service that provides
musicians with a central profile through which to engage with and sell to fans across online music
services. Deezer intends to leverage this partnership to explore opportunities to engage listeners with
their favorite musicians.
92
11.3
SUBSCRIBED SHARE CAPITAL AND AUTHORIZED BUT UNISSUED SHARE
CAPITAL
Section 21.1.1 “Subscribed Share Capital and Authorized but Unissued Share Capital” of the
Registration Document is completed with the following information.
The table below present the financial resolutions that have been adopted by the meeting of the
shareholders of the Company dated October 9, 2015.
Resolution purposes
Maximal nominal amount
Term of the authorization
Authorization granted to the Board of Directors for the
purposes of purchasing the shares of the Company(1)
-
18 months(2)
Delegation to the Board of Directors of authority to decide a
capital increase of the Company or of another company
through the issuance of shares and/or securities giving
immediate or deferred access to the share capital, with
preferential subscription rights(1)
EUR 105,000(3)
EUR 500 million with respect to
debt instruments
26 months(2)
cancellation of the preferential subscription rights, by public
offering
EUR 105,000(3)
debt instruments
26 months(2)
cancellation of the preferential subscription rights, through
private placements in accordance with article L. 411-2, II of
the Monetary and Financial Code(1)
EUR 20,000(3)
debt instruments
26 months(2)
Authorization granted to the Board of Directors to issue shares
or securities giving immediate or deferred access to shares to
be issued by the Company in consideration for contributions in
kind consisting of equity securities or securities giving access
to the share capital(1)
EUR 20,000(3)
debt instruments
26 months(2)
Determination of the issuance price within the limit of 10% of
share capital per year, as part of a capital increase through the
issuance with cancellation of the preferential subscription
rights of equity securities(1)
10% of the share capital per year
-
Delegation to the Board of Directors of authority to decide the
capital increase through incorporation of premiums, reserves,
earning or other (1)
EUR 20,000(3)
26 months(2)
increase of the number of securities to be issued in case of a
capital increase with preferential subscription rights
Limitation in accordance with
application regulation as of the
date of the issuance (i.e., to date,
15% of the initial issuance)(3)
26 months(2)
issuance of shares and/or securities giving immediate or
deferred access to the share capital, with cancellation of the
preferential subscription rights, reserved to people adhering to
saving plans
EUR 20,000(3)
26 months(2)
granting of stock subscription or purchase shares to the benefit
of certain employees or coporate officers of the group(1)
EUR 10,000(3)
26 months(2)
EUR 10,000(3)
26 months(2)
93
Resolution purposes
Maximal nominal amount
Term of the authorization
granting of free shares issued or to be issued to the benefit of
certain employees or coporate officers of the group(1)
Authorization granted to the Board of Directors to reduce the
share capital through cancellation of treasury shares(1)
Within the limit of 10% of the
shares composing the share
capital as of such date
24 months(2)
capital increase through the issuance of shares with
cancellation of the preferential subscription rights, reserved to
the existing shareholders
EUR 20,000(3)
18 months(2)
(1)
Resolution adopted under condition precedent of the listing of the shares of the Company on the regulated market of Euronext
Paris.
(2)
As from October 9, 2015.
(3)
The global nominal maximum amount of capital increase to be completed pursuant to such delegation is deducted from the
global ceiling equal to EUR 105,000.
At the extraordinary general meeting of the shareholders of October 9, 2015, the shareholders resolved
to reduce the nominal value of the shares from €0.29 per share to €0.01 per share.
COMPOSITION OF THE COMMITTEES OF THE BOARD OF DIRECTORS
11.4
Section 16.4 “Committees of the Board of Directors” of the Registration Document is updated with a
new Section 16.4.3 as follows.
Pursuant to the meeting dated September 24, 2015, the Board of Directors decided that the Committees
of the Board of Directors would be composed, subject to condition precedent of the listing of the
Company’s shares on the regulated market of Euronext Paris, as follows:
11.5
-
Audit Commitee:
o Mrs. Annie Ferton (as Chairman of the Audit Committee);
o Mrs. Andria Vidler; and
o Mr. Pierre Louette, acting as representative (représentant permanent) of Orange
Participations.
-
Nomination and Compensation Committee:
o Mr. Guillaume d’Hauteville (as Chairman of the Nomination and Compensation
Committee);
o Mrs. Amanda Cameron; and
o Mr. Guillaume Lautour.
STATEMENT RELATING TO CORPORATE GOVERNANCE
The table provided under Section 16.5 “Statement Relating to Corporate Governance” of the
Registration Document is updated with a new row as follows.
Recommendations of the AFEP-MEDEF Code
Comments of the Company
Recommendation n° 17.1. Membership and The Chairman of the Compensation and
form of operation (of the committee in charge of Nominations Committee is not an independent
director. However, the Board of Directors
appointments or nominations)
considers his experience (in particular his
When the appointments or nominations committee knowledge of the Company, its managers and its
94
is separate from the compensation committee, the
recommendations relating to the latter's
membership and mode of operation are also
applicable to it (see hereafter).
governance, and his ability to contribute to the
organization of management teams in this sector)
as such his function as Chairman of the
Compensation and Nominations Committee will
be profitable to the Company
However, unlike the provisions governing the
compensation committee, the Chief Executive
Officer shall be associated with the appointments
or nominations committee’s proceedings. In the
event that the offices of Chairman of the Board of
Directors and Chief Executive Officer are separate,
the Chairman may be a member of this committee.
Recommendation n° 18.1. Membership (of the
Committee in charge of compensation)
The committee should not include any executive
directors, and should have a majority of
independent directors. It should be chaired by an
independent director. It is advised that an
employee director be a member of this committee.
11.6
BENEFITS OF SENIOR EXECUTIVES
Section 15.1.3 “Benefits of Senior Executives” of the Registration Document is amended as follows.
The Board of Directors has decided not to grant any bonus to Senior Executives directly related to the
transaction.
11.7
OTHER RELATED PARTY AGREEMENTS
Section 19.1, “Other Related Party Agreements”, of the Registration Document is updated as follows.
19.2.7 Service provision agreement with Access Industries
The Company and Access Industries have entered into a service agreement related to the provision of
services by Access Industries to the Company with respect to recruitment, international development and
support to strategic projects. The amounts invoiced with respect to this agreement is a fixed amount of
€300,000.
11.8
STOCK OPTIONS
The number of outstanding Stock Options 14 mentioned in Sections 21.1.4.3 “Stock Options” and
21.1.4.4 “Summary table of the outstanding stock options granted by the Company” of the Registration
Document shall be read as 10,926 Stock Options 14. An employee having left the Company in August
2015 still benefits from 75 Stock Options 14 (i.e., 2,175 Stock Options 14 after Stock Split) which might
be exercised, in all or part, until November 2015.
11.9
CONCORDANCE TABLE
The table below provides a reconciliation between the information that complement the information
provided under the Registration Document as mentioned in this Securities Note, the Registration
95
Document, and Annex I of EU Regulation 809/2004 of the European commission dated April 29, 2004,
as amended.
Securities Note
Annex I of EU Regulation 809/2004 of the European
commission dated April 29, 2004
Registration Document
Paragraph
Paragraph
Page
N°
Item
11.1
4.1.7.3
40
4
Risk factors
11.2
6.5.1.2
68 and seq
6.1
Principal activities
11.3.
21.1.1
181
21.1.1
Additional information – share capital
11.4
16.4
164 and seq
16.3
Committees of the board of directors
11.5
16.5
168 and seq
16.4
Statement Relating to Corporate Governance
11.6
15.1.3
160
15
Compensation and benefits
11.7
19.2
177 and seq
19.2
Related party transactions
11.8
21.1.4
185 and seq
21.1.1
Additional information – share capital
96

Securities Note

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