Banijay Endemol – an exceptional deal
This summer saw the completion of Banijay’s acquisition of Endemol Shine Group, an M&A deal that created the independent world leader in content production and distribution. Read on to find out how Natixis works to support landmark transactions in the media and entertainment industry.
On October 25, 2019, media production company Banijay officially concluded the definitive agreement to buy out 100% of Endemol Shine Group's shares, a next – although not final – step in the acquisition process launched at the end of 2016. This transaction project has been an ambitious and extensive project for Natixis: "we had been involved in all our client's major transactions over recent years; however the acquisition of Endemol Shine Group (ESG) was very different" notes Yann Le Fur Senior Banker in charge of the relationship with LOV group at Natixis. He continues: "first, we needed to be convinced and then Banijay Group Chairman Stéphane Courbit needed to be won over on the deal's financial feasibility too, as the move involved buying out a business twice the size of his company! The mutual trust built up during our long business relationship over the years, along with our specific banker's view on the transaction meant we were able to convince him that this could be an attractive prospect for investors and that we could base the funding on these assets. We both decided to take the plunge and see this deal through." Along with Deutsche Bank and Société Générale, Natixis fully refinanced the financial debt on this transaction for a total of €2.4bn.
Another arrow in Natixis' quiver is its relationship expertise, as Yohan Quere supervising the transaction at Natixis New York explains "our international reach meant we were able to support meetings, representing and getting stakeholders involved to set the stage for talks to get started – for example with Apollo Global Management, the US fund that holds a stake in ESG, but that did not have a connection to Stéphane Courbit." This support from Natixis is particularly crucial in the media and entertainment industry, as in this situation especially the personalities of people involved – executives, managers, creatives – make a central contribution to the asset's value that is at least on a par with the worth of intellectual property rights.
A milestone event for the sector
Banijay created a French world leader when it acquired one of its main competitors, building the largest independent content creation group with a presence across 22 countries via 120 labels that provide content for all media platforms at TF1, Canal+ and la Rai, as well as Netflix and Amazon Prime. This media heavyweight posts pro forma revenues of €2.7bn and boasts 85,000 hours of content. Meanwhile in a clear testimony to the significance of this deal for the entertainment industry, it was supported by prestigious partners such as Fimalac and the company's head Marc Ladreit de Lacharrière, as well as Vivendi, which holds 32% of Banijay, and whose chairman Vincent Bolloré was personally involved in negotiations. "The involvement of these partners reflects their support in fostering the creation of an independent world leader in France, with the breadth and global scale to engage effectively with all the major content distribution platforms" adds Richard Brail, Managing Director and Head of Media & Entertainment at Natixis' US M&A affiliate PJ SOLOMON.
The Banijay Endemol deal is one of the largest transactions Natixis has managed in the media and entertainment industry, but it is also a clear example of the company's ability to handle major acquisitions beyond the mere financial aspects. Natixis offers a real one-stop shop and is in a position to offer clients the full range of services to manage their deals, regardless of the business sector. As Yohan Quere explains: "we have a worldwide network of M&A affiliates, which includes PJ SOLOMON. Like all the main banks, we can provisionally carry the financial commitment on Natixis' balance sheet and then distribute it on the various relevant markets. We also offer a high-quality rating service. Supporting our clients throughout the process is key in M&A, where confidentiality and trust are vital given the figures involved." Natixis' clients not only include Banijay, but also Lagardère, Mediawan and Vivendi, which the company supported during the Havas takeover and more recently in its share buyback campaign, reflecting the company's more extensive M&A expertise in the media and entertainment industry.
"Our trusted relationship with Natixis, which has supported Banijay in its development right from the outset, was a key factor in the success of this deal. We drew on the full range of the bank's expertise, helping us be agile and move swiftly in a highly complex cross-border transaction" states Stéphane Courbit.