- Final agreements in connection with
the acquisition of a 51% stake in ON Entertainment, gathering:
- the ‘kids & family’ animation
business – European animation leader – managed by Aton
Soumache
- the live sector ‘Chapter 2’ directed
by Dimitri Rassam, behind the franchise ‘Papa ou Maman’ and the
feature film ‘Le Prénom’
- Groupe Mediawan quarter revenues at
€42.7 million, in line with expectations and full-year target
- strong performance from Distribution
and Channels & Digital historical business units
- contribution from Production
activity in accordance with the delivery timetable for the
year
- Further operating developments
across all core business lines and production line-up
reinforced
Regulatory News:
Mediawan (Paris:MDW)(ticker: MDW - ISIN: FR0013247137),
an independent European audiovisual content platform, announces
today the execution of the final agreements regarding the purchase
of a 51% stake in ON Entertainment.
These agreements are the results of the exclusive negotiations
announced on December 17, 2017, enabling the parties to finalise
the operation’s terms, in particular by enlarging the acquisition’s
perimeter by including not only the animation business with ‘ON
kids & family’ – animation production European leader – but
also its live sector dedicated subsidiary ‘Chapter 2’, managed by
Dimitri Rassam.
Mediawan also announces its consolidated revenues for the first
quarter of 2018 as below detailed, integrating a break down by
business segment in accordance with IFRS 15 standards (applicable
as of 1 January 2018):
€m Production Distribution
Channels &
Digital
Consolidated total
Revenues 6.0
9.7 27.0 42.7
The recorded revenues are in line with the expectation and in
accordance with management’s expectations and in line with
full-year targets. This performance reflects the delivery timetable
for audio-visual programs and the opening up of right entitlements
during the first 3 months of 2018.
Pierre-Antoine Capton, Mediawan’s Chairman, says: “The
first quarter of the year was decisive in terms of Mediawan’s
development, in particular thanks to the structural acquisitions
carried out. The agreements with ON Entertainment is a major step
stone for the group shooting therefore becoming a European leader.
In terms of financial performance, first-quarter revenues confirm
the sturdiness of our “Channels & Digital” activity and our
Distribution platform. As expected, most of the Production’s
revenues will be generated over the next quarters, during which
most of the programs for 2018 will be delivered.
1. Final agreements in connection with the acquisition
of a 51% stake in On Entertainment
Terms of agreement
Pursuant to the exclusive negotiations announced on 17 December
2017, Mediawan signed the final agreements in connection with the
purchase of a majority stake in ON Entertainment:
- enlarging the acquisition’s perimeter
(initially limited to the animation business of ON kids &
family), now embracing the group as a whole, including Chapter 2,
the live subsidiary, managed by Dimitri Rassam;
- incorporating Groupe AB’s 5%, Mediawan
will hold 51% pro forma share capital stake, alongside the founders
and remaining managers;
- total cash out of €51 million for
Mediawan, for the acquisition of shares and a €16 million share
capital increase;
- the co-founders Aton Soumache and
Dimitri Rassam, remain shareholders in ON kids & family and
join forces with Mediawan in order to develop growth in France and
abroad. Part of their stake will be converted into Mediawan shares
(up to 1,000,000 shares to be issued, which will bring Mediawan’s
ownership in ON Entertainment’s share capital to 60-65%.
The transaction should be finalized within the coming weeks,
closing being subject to the lifting of the usual condition
precedents for this type of transaction.
On Entertainment, European leader of
premium content
ON Entertainment produces major international audiovisual
creations by developing emblematic brands with considerable
commercial possibilities, and will keep on developing high-end
content via the creation of powerful franchises and the management
of world-renowned intellectual property:
- leader in the production of kids &
family animated content, a sector seeing buoyant global growth, the
ON Entertainment group’s strength is its ability to capitalize on
both a strong portfolio of pre-existing brands based on classical
works from European and international cultural heritage (The Little
Prince, Playmobil, Robin Hood, Peter Pan, Tall Tales, Little Nick,
Chaplin, Iron Man) and innovative original creations with
substantial global potential thanks to its unique know-how
(Miraculous Ladybug, Zak Storm, Seven & me, Mune, etc.).Based
on its animation series production’s expertise and its
worldwide-known characters, the Group has then entered with success
into animation movies with The Little Prince (July
2015), or Tall Tales (December 2017). Via its ON
Animation Studios entity, the Group is currently producing the
Playmobil animated film in its Montreal studios. This is the first
part of a worldwide franchise, has an $80 million budget and is due
for global release in April 2019. It is being directed by Lino Di
Salvo, who has already worked on the animation of Frozen and
Raiponce for Disney.
- Additionally, On Entertainment is a key
leader in the ‘live’ production activity, with its division Chapter
2, managed by Dimitri Rassam, who contributed to several public
successes, such as Papa ou Maman (TV series and feature
films), Le Prénom or Le Brio.
As for the animation sector is concerned, Chapter 2’s strength
is to create successful brands able to be internationally exported
via multi format adaptations, remakes or international sales.
The Group’s brands, developed in-house or under copyright or
with strategic partners, whether television series or feature
films, also generate considerable Licensing & Merchandising
revenue. By working, prior to the financing of its projects, with
leading toy manufactures on this market (Playmobil, Bandai,
Playmates or Hape Toys), and through the setting up of strong
partnerships, ON Entertainement has put the Licensing &
Merchandising aspect at the very heart of its strategy.
Thanks to its 5 strategic studios located in Paris, Montreal,
Luxembourg, Los Angeles and Hyderabad (India), which have more than
500 staff between them, ON Entertainment is capable of attracting
the most talented people and raising substantial financial
resources. It brings together creators and partners to develop
brands via various formats: cinema & television, merchandising,
publishing and digital.
Today, ON Entertainement has established itself as a major
European player in the creation and production of animated content
for children and families, for television, cinema and digital
platforms.
2. Revenues as of 31 March 2018
Revenues for the first quarter came to €42.7 million matching
the expectation and in accordance with management’s expectations
and in line with full-year targets.
These revenues include the contribution to finalize acquisitions
during the quarter: Storia Télévision (January 15th) and Makever
(March 15th). In light of these acquisitions, which have made
Mediawan the No.1 fiction producer in France, the Management Board
wanted to redefine the group’s business segments by separating
Production activities.
Production
Production revenues include new deliveries of programs and
revenues from secondary sales of programs produced by the Group,
net of distribution fees.
As of 31 March 2018, Production revenues recorded €6.0 million,
reflecting the expected program delivery timetable for 2018 (new
deliveries of programs during the period mainly correspond to the
last five episodes of Section de Recherches – season 12).
The production timetable forecast that most programs delivery
should occur during the second semester, and in particular during
the last quarter of the year.
Numerous projects are already under development or in
production, such as: season 2 of Black Spot, season 6 of Captain
Sharif, the first season of Noces Rouges, the TV series adaptation
of Arthur et les Minimoys, as well as the pursuance of the
Apocalypse history documentaries. The Group also co-produced I’m
not an easy man, the first French “Netflix Original” available on
the platform since early April.
Mediawan is aiming to continue with and step up its strategy of
producing premium content, creating new brands and valuable
intellectual property, as well as capitalising on its existing
series. The large success of the 12th season of Section de
Recherches and the first season of The Red Band Society, attracting
an average audience above 25%, series of which the next season
currently being written, confirmed these series strength during the
first quarter.
Distribution
Distribution revenues are primarily composed with (i) sales of
rights acquired by the Group and (ii) distribution fees charged
from the sale of rights by the Group’s production companies or by
third parties.
Revenues during the period came to €9.7 million, a strong
increase compared to 2017. These sales were mainly driven by French
broadcasters (TF1, FTV and M6) and stem from Group’s produced
rights (Alice Nevers) as well as acquired rights (Paramount’s
movies, Friends, Rex,…). Besides, several sales have been concluded
with international players such as Moviestar, Discovery channel,
Sky Deutschland, Mediaset, NBCU, AMC, and Bilibili.
Mediawan keeps on meeting with the ever-growing demand for
European contents thanks to sales of premium French productions to
leading worldwide players. For example, AB International
Distribution has agreed with Amazon to deliver on the streaming
platform -Prime Video- specifically targeted programs for
French-speaking Europe, which rights, owned by the Group, have
already received a huge success with the public and are now
attracting SVOD operators.
The Group has also recently announced French rights’s sale of
the series Babylon Berlin (16x45’) to the Canal+ Group. The series
will be broadcasted on Canal+ in 2018 and was showcased during the
closing ceremony of the “Série Mania” festival in Lille on May
5th.
Channels and Digital
During the first three months of 2018, the Channels &
Digital division generated revenues of €27.0 million, comprising
primarily with (i) incomes from royalty fees of €18.6 million and
(ii) advertising revenues of €6.0 million.
The increase’s in revenues compared to the 1st quarter of 2017
in attributable to a 1% growth of royalty fees and a 4% growth of
advertising revenues.
Advertising revenues increased despite difficult market
conditions in Belgium, counterbalanced with primarily good
audiences. The new ABXplore channel achieved in particular an
audience share of above 4% among men aged 18-44 (increase of 229%
since launching).
Income from royalty fees incorporates new terms in contracts
renewed this year, as well as development related to the channel
offer. This development is continuing during the next quarter with
a partnership with Bouygues Telecom in connection with the launch
of its new “Bbox 4K”, on which the Ultra Nature channel will be UHD
broadcasted. The Group is also associated with Salt -mobile
operator in Switzerland- in connection with the launch of a fixed
network service to provide nine of its channels (RTL9, AB1, Mangas,
AB Moteurs, Science & vie TV, Toute l’Histoire, Chasse &
Pêche, Trek and Animaux).
Lastly, the Group carried on with its strategy of developing
content dedicated to eSport, global phenomenon gathering an
ever-growing number of participants, audience and economic issues.
Apart from to the acquisition of the rights to the Overwatch
League, the Group also exclusively broadcasted the final stages of
the Gfinity Elite Series, based on the famous fighting game Street
Fighter V -flagship and multi-generational Capcom licence- on its
Mangas channel.
2018 Outlooks
Mediawan will pursue its growth strategy, with a number of well
identified levers notably an important line-up, support the 2018
good perspective, with a target pro forma revenues at €270
million.
3. First quarter highlights
External growth
During the 1st quarter of 2018, Mediawan finalised the
acquisition of EuropaCorp’s television on-going business, as well
as the acquisition of a majority stake in the Makever Group.
The other acquisition announced, namely the announcement of
exclusive discussions concerning the acquisition of 60% of Mon
Voisin Productions, is to be finalized during the course of the 2nd
quarter of 2018.
Other significant events
On March 19, 2018, Mediawan signed up for a €45.0 million bridge
loan with a maturity of 18 months. This credit facility, which has
not yet been drawn, will enable the Group to finance future
acquisitions and increase its financial flexibility.
Next financial press release: revenues and financial results
as of 30 June 2018, no later than 30 September 2018.
About Mediawan
Mediawan was incorporated in December 2015 as a Special Purpose
Acquisition Company (SPAC) for the purpose of acquiring one or more
targeted operating businesses or companies in the traditional and
digital media content and entertainment industries in Europe. The
Company was formed by Pierre-Antoine Capton, Xavier Niel and
Matthieu Pigasse, and raised €250 million in April 2016 from an
initial public offering on the Euronext regulated market in
Paris.
In March 2017, Mediawan acquired Groupe AB and thus became an
independent leader in audiovisual content in French-speaking
Europe. The Group is active in the production and distribution of
television series, TV movies, cartoons and documentaries and in the
publication of TV channels and associated digital services.
With the acquisition of CC&C in July 2017, the entering into
exclusive talks with ON kids & family in December 2017, the
acquisition of EuropaCorp Television’s business (excluding US
series) in January 2018 and the acquisition of a majority stake in
Makever on 15 March 2018, Mediawan continued its growth strategy in
international content in the field of fiction, documentaries and
animated content.
Disclaimer
This document may contain forward-looking statements. Although
Mediawan believes that the estimates and projections reflected in
the forward-looking statements are reasonable, they may prove
materially incorrect, and actual results may materially differ. As
a result, you should not rely on these forward-looking
statements.
For further information, please visit the Mediawan website
(www.mediawan.fr).
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MEDIAWANinvestors@mediawan.eupress@mediawan.euorNewCapInvestor
RelationsMarc Willaumemediawan@newcap.eu+33 (0)1 44 71
00 13orNewCapMedia RelationsNicolas
Merigeaumediawan@newcap.eu+33 (0)1 44 71 98 55