The game will be closer than expected to win Believe, the French group specializing in music distribution. Will it remain in the hands of its CEO, Denis Ladegaillerie, backed by the EQT ) ? The Financial Markets Authority, which looked into the matter on Tuesday March 19, must say in the coming days whether the conditions proposed in the consortium’s offer are valid or whether negotiations with Warner Music should be opened.
Believe has found itself in a stock market impasse. Maybe because she wanted to make herself bigger than the ox? The company made its IPO on Euronext Paris in June 2021, at a price of 19.50 euros per share. This allowed it to raise 300 million euros – less than the 500 million euros initially hoped for.
But for three years, Believe shares have remained well below the starting price. And this, while the company is posting excellent results: a turnover increasing by more than 20% per year since 2021, an ebitda (profit before interest, taxes, depreciation and amortization) of 5.7% in 2023 – which was the objective to be achieved in 2025 – and an acquisitions policy almost in line with forecasts (100 million euros per year).
Berezina stock market
The company has strengthened its various businesses: the production of artists, French in particular, like Jul or Vianney – it produces more than the three majors and can boast 47 albums in the Top 100 in France in 2023 –, support for independent labels, the development of the music publishing branch or the digital music distributor TuneCore.
How, then, to explain this stock market berezina? Management mentions the rise in interest rates, the lack of liquidity, the geopolitical situation or the difficulties encountered by “mid caps” (companies with a capitalization between 250 million euros and 1 billion euros). The defeat is all the more stinging as the actions of music giants, such as Universal Music Group or WMG, have, during this time, sparked…
Denis Ladegaillerie, who does not speak officially, admits to those close to him that he was never in favor of an IPO, but he followed through. He himself owns 12.5% of Believe. So he, but also his parents, his friends, like all the shareholders, are “glued”.
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