VC-backed Deezer to list before year-end

Deezer's planned market capitalisation was not divulged, but press reports stated it could break the €1bn threshold. Should the figure be confirmed, the music streamer would be the latest name to join the list of so-called "unicorns" in France, after car-sharing service BlaBlaCar reportedly broke the €1.4bn valuation mark during its $200m series-D last week.

Deezer is currently owned by a group of minority shareholders that entered its capital structure at various funding stages. The investment holding Access Industries, also the current owner of Warner Music Group, holds a 36.72% stake in Deezer. Mobile operator Orange, a partner of Deezer in France since 2010, owns a 14.56% interest.

French GPs Idinvest and CM-CIC are the fourth and sixth largest shareholders with 12.9% and 5.3% stakes, respectively. Additional shareholders include entrepreneurs Daniel Marhely and Xaviel Niel, as well as music multinationals like Sony, Warner and Universal.

Deezer will dedicate the IPO proceeds to improving content distribution via its network of partnerships and new marketing campaigns.

Competition among music streamers is hotting up, with investor appetite for the segment driving up equity cheques. Spotify, Deezer's direct competitor, scooped up $525m from Baillie Gifford, Lansdowne Partners and Rinkelberg Capital during a round before the summer – the startup was valued at a record $8.5bn at the time. 

Created in 2007, Deezer is an on-demand music streaming service. Its catalogue, featuring more than 35 million tracks and 40,000 podcasts, is browsed by 6.3 million users worldwide – 1.5 million of whom are direct subscribers, while the remaining 4.8 million access the content via one of the telecom operators Deezer is partnered with.

With headquarters in Paris, the company operates out of offices in 11 additional European countries, and the US, Mexico, Colombia, Brazil, Thailand and Singapore. Its activities worldwide generate a €142m in turnover, a 53% uptick on the 2013 figure.

According to unquote" data, Deezer first came under private equity ownership in October 2009, two years after being founded. The streaming service raised €6.5m from Idinvest, CM-CIC and existing investor Dotcorp Asset Management to finance global expansion, which kicked off when offices were set up in the UK.

A €100m second round took place in October 2012. The funding, led by Access Industries' €70m contribution, also featured capital from Idinvest, CM-CIC, Orange and Dotcorp.

The larger equity ticket for Deezer came as the company's internationalisation accelerated. Having announced a strategy to enter 200 countries in 2011, the business became available in Canada, Australia, New Zealand and Colombia the following year.

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• Topics
• France
• Exits
• Technology
• France
• IDInvest Partners (AGF Private Equity)
• IPO