Music streaming service Deezer plans Paris listing

Reuters News
Posted: Sep 22, 2015 1:57 AM

PARIS (Reuters) - Music streaming service Deezer plans to carry out a flotation on the Paris stock exchange by the end of the year, it said on Tuesday, in a bid to keep up with larger, deeper-pocketed rivals such as Apple and Sweden's Spotify.

The company, which was founded in 2007 in Paris, counts 6.3 million subscribers who can listen to a catalog of 35 million songs for a monthly fee of 9.99 euros ($11.18).

The valuation will depend on investor demand, but analysts expect the company could be valued at about 1 billion euros.

Present in 180 countries, the bulk of Deezer's paying customers are in France where 4.8 million get access because the service is bundled with their mobile service from telecom operator Orange, also a shareholder.

It has struggled to keep up with Spotify, which has 15 million paying customers and raised about $500 million in a funding round in June, valuing it at $8.5 billion, according to media reports.

Deezer said revenue grew 53 percent last year to 142 million euros. It said it aims to hit monthly positive operating profit and cash flow by the end of 2018.

The initial public offering (IPO) will allow Deezer to expand its offering, "drive deeper distribution through our telecom and manufacturer partnerships" and improve its product and content, Chief Executive Hans-Holger Albrecht said.

Deezer's largest shareholder is tycoon Len Blavatnik's Access Industries, and three music labels - Access' Warner Music, Sony Music, and Universal Music - own 20 percent of the shares.

Albrecht said none of the current shareholders would sell their stakes in the IPO, adding that the proceeds would largely go towards investing in its distribution and sales network in the next two years.

($1 = 0.8936 euros)

(Reporting by Leila Abboud; Editing by James Regan)