M&A

Mondadori Group: acquisition of 51% of Star Shop Distribuzione completed

The Mondadori Group announces that, through its subsidiary Mondadori Libri S.p.A., it has today completed the acquisition of 51% of the share capital of Star Shop Distribuzione S.r.l., a company operating in the comics segment with pubishing and gadgets, particularly as a distributor for third-party publishers in the comic book channel and operator of direct and affiliated retail outlets in the same segment.

As communicated to the market on 29 June 2023, following authorisation by the Italian Antitrust Authority pursuant to Law 287/1990 – as previously announced on 3 November 2023 -, the transaction is effective from today’s date, as of which Mondadori will also proceed with the full consolidation of the company.

As previously stated, the acquisition makes it possible to replicate in the comics segment the vertically-integrated business model with which the Mondadori Group already operates in the book segment.

Under the agreement, Sergio Cavallerin and Matteo Cavallerin – who founded and have thus far successfully managed the company – will retain management responsibility and continue to hold the role of Executive Directors in the Company.

The price, based on an Enterprise Value of 9 million euros, covering 100% of the Company, is 4.6 million euros, entirely paid in cash today, and will be subject to adjustment based on the final net financial position on 1 February 2024.

As previously stated, the agreement includes the signing of put & call option contracts governing the transfer of the residual 49% share of Star Shop Distribuzione. The options will be available for exercise in two equal tranches respectively starting from the approval of the 2025 financial statements and of the 2028 financial statements, at a price to be defined on the basis of the company’s results during the three-year periods 2023-2025 and 2026-2028.

Mondadori Group: agreement signed for the sale of the investment in Mediamond S.p.a. to Publitalia ‘80 S.p.a.

Arnoldo Mondadori Editore S.p.A. has announced today’s signing of the contract of sale of the entire stake in Mediamond S.p.A. – advertising sales company – equal to 50% of the share capital and held by its subsidiary Direct Channel S.p.A., to Publitalia ‘80 S.p.A. The transaction will take effect from 1 January 2024 and will allow Publitalia ‘80 S.p.A., which already holds 50% of Mediamond S.p.A., to increase its stake to 100%.

The transaction price was defined on the basis of the pro-rata value of equity as at 31/12/2023, expected to amount to € 1.4 million and corresponding to the book value of the interest, with consequent neutral accounting effects on the Mondadori Group’s consolidated result.

The sale is consistent with the strategy already announced by the Mondadori Group to focus on the sector of books and a gradual easing off of its presence in business areas that are no longer central and, in particular, sectors heavily associated with advertising revenue.

In the context of the transaction – pursuant to the regulation approved with Consob Resolution no. 17221 of 12/03/2010, as amended – Publitalia ‘80 S.p.A. qualifies as a related party of Arnoldo Mondadori Editore S.p.A. since the former is a company subject to joint control with Arnoldo Mondadori Editore S.p.A.

Nevertheless, the transaction is of lesser importance since it does not exceed the thresholds identified pursuant to article 4, paragraph 1, letter a) of the aforementioned Consob Regulation.

The sale was consequently approved by the Board of Directors of Arnoldo Mondadori Editore S.p.A. following a motivated – non-binding – favourable opinion on the company’s interest in executing the transaction and on the expediency and substantial fairness of the related conditions issued by the Related Party Committee, formed exclusively of independent directors.

Group 2023 guidance revised upwards – Acquisition of 51% of Star Shop Distribuzione

Mondadori Group: upwards revision of 2023 guidance. Contract for the acquisition of 51% of Star Shop Distribuzione, company operating in the comics channel.

The Board of Directors of Arnoldo Mondadori Editore S.p.A. has today examined and defined – in light of a more favourable evolution than had been previously forecast of both the business and the prices of the main production factors – the upwards revision of the FY 2023 targets previously disclosed to the market.

Income Statement:

  • single-digit revenue growth confirmed;
  • Adjusted EBITDA expected to rise by high single-digit/low double-digit (compared with the previous single-digit forecast), with margins expected to range between 16% and 17% (from the previous 15%);
  • approximately 20% growth of the net result, forecast doubled with respect to the previous estimates (+10%), due to both the operational improvement and the effects of the sale of the equity investment held in il Giornale.

Cash Flow and Net Financial Position:

  • ordinary cash flow is expected to range between € 65 and 70 million, showing an increase of up to 15% compared with the 2022 figure (previous estimate: € 60-65 million, +10%);
  • the Group’s net financial debt (IFRS 16) is confirmed to come in, at end FY 2023, as 1.0x adjusted EBITDA, down from 1.3x at end 2022.

The Mondadori Group also reports that today the parent company Arnoldo Mondadori Editore S.p.A. signed the contract for the acquisition of an equity investment equal to 51% of the share capital of Star Shop Distribuzione S.r.l. operating in the distribution of third party publishers in the comics channel and in the management of direct and franchised sales outlets in the same segment.

The acquisition would make it possible to replicate the vertically-integrated business model with which the Mondadori Group already operates in the book segment, in the comics segment too.

The acquisition of 51% of the share capital of Star Shop Distribuzione has been defined on the basis of an enterprise value, on a cash free/debt free basis (in relation to 100% of the Company), of € 9 million.
The price, which will be paid in full, in cash, at closing, will be adjusted on the basis of the net financial position and net working capital at the date on which the acquisition is completed.

The execution of the transaction is subject to the issue by the Antitrust Authority, in accordance with Law 287/1990, of a ruling not to start an investigation or to authorise the transaction, which entails no charges or requirements or corrective measures considered relevant for the Mondadori Group or Star Shop Distribuzione.

The agreements defined also envisage the signing of put & call option contracts governing the transfer of the residual 49% share of Star Shop Distribuzione. The options will be available for exercise in two equal tranches respectively starting from the approval of the 2025 financial statements and of the 2028 financial statements, at a price to be defined on the basis of the company’s results during the three-year periods 2023-2025 and 2026-2028.

In FY 2022, Star Shop Distribuzione recorded revenues of € 34.2 million, EBITDA of € 2 million and net profit of € 1.2 million.

The transaction sees Sergio Cavallerin and Matteo Cavallerin – who founded and to date have successfully managed the company – retain management responsibility and continue to hold the role of Executive Directors in the Company.

Mondadori Group finalized the sale of its stake in Società Europea di Edizioni, publisher of the Il Giornale daily newspaper

Arnoldo Mondadori Editore S.p.A. announces to have finalized today the closing of the disposal of its 18.45% equity stake in Società Europea di Edizioni S.p.A. to P.B.F. S.r.l., previously announced on 16 March last.

The sale consideration, to be settled entirely in cash, was set at 2.3 million euro, taking account of the price adjustment mechanism based on the company’s net financial position at the closing date.

The sale has generated a net capital gain of 0.5 million euro in the Mondadori Group income statement.
In financial year 2022, this stakeholding generated a loss of 1.8 million euro in the consolidated financial statements.

The sale is consistent with the Group strategy to focus on the books business and divest non-core assets.

Mondadori Group raises its stake to 75% in A.L.I. – Agenzia Libraria International

The Mondadori Group announces the conclusion today, through its subsidiary Mondadori Libri S.p.A., of the acquisition of a further 25% stake in A.L.I. S.r.l. – Agenzia Libraria International, operating in the distribution of books.

The transaction – which raises the Mondadori Group stake in A.L.I. to 75%, which will be subject to full consolidation as of 1 January 2023 – takes place in execution of the agreements defined and disclosed last 11 May 2022 upon acquisition of an initial 50% stake, effective earlier than the date originally scheduled for 28 February 2023.

The provisional price, paid entirely in cash, is approximately € 9.5 million and was determined, as already disclosed to the market, on the basis of an average 2021-2022 EBITDA and the positive net financial position (cash) of the scope covered by the transaction, which at 31 December 2022 amounted to € 17.8 million (preliminary figure).

Additionally, the defined agreements give the Mondadori Group the right to acquire the remaining 25% in A.L.I., at a price to be determined on the basis of an average 2023-2024 EBITDA, through put&call options exercisable by 30 July 2025.

The transaction is consistent with the path of vertical integration in the books market, with a view to the gradual strengthening in the promotion and distribution activities of third-party publishers.

 

 

Mondadori Group: completed disposal to Reworld Media of the operations under the Grazia and Icon brands

The Mondadori Group announces the execution today by the subsidiary Mondadori Media S.p.A. of the contract for the disposal to Reworld Media S.A. – signed last 22 November and disclosed to the market on the same date – of the print and digital publishing operations of the Grazia and Icon brands, as well as the related international licensing network.

 The execution of the transaction took place with the transfer of the business unit heading the operations disposed of to a newly-incorporated company and the concurrent disposal to Reworld Media of 100% of the share capital of the transferee.

 

Mondadori Group: Presidency of the Council of Ministers gives go-ahead to the disposal to Reworld Media of the operations under the Grazia and Icon brands

The Mondadori Group announces that it has received notification today from the Offices of the Presidency of the Council of Ministers of the resolution not to exercise the special powers under Law Decree 21/2012 regarding the disposal to Reworld Media S.A. of the operations under the Grazia and Icon brands, as disclosed last 22 November.

The measure, which in essence authorizes the disposal of the above operations, triggers the fulfilment of the suspensive condition attached to the sale agreement, which will therefore be fully executed on the closing date.

The completion of the transaction will be promptly disclosed to the market.

Mondadori Group: signing of disposal to Reworld Media of the Grazia and Icon brands

The Mondadori Group announces that, on today’s date, the subsidiary Mondadori Media S.p.A. exercised the put option, previously disclosed to the market last 20 October, and, as a result of it, signed the agreement that regulates the disposal to Reworld Media S.A. of the print and digital publishing operations of Grazia and Icon as well as the related international network.

The consideration for the transaction, as previously disclosed, is € 8.5 million, including € 2 million as earn-out conditional on the achievement of certain financial results in 2023 by the operations disposed of. The price – to be paid in cash at the closing date was defined on the basis of an Enterprise Value of € 11 million (including earn-out), net of the difference between the average net working capital over the last 12 months and the net working capital at the closing date.

In 2021, the above-mentioned activities generated revenue of approximately € 18 million.

Completion of the transaction – subject to the outcome of the assessment procedure under Law Decree 21/2012 by the Offices of the Presidency of the Council of Ministers – will take place through the transfer by Mondadori Media of the business operations to be disposed of to a newly-incorporated company and the subsequent disposal to Reworld Media of 100% of the share capital of the transferee.

In accordance with the provisions of law, the procedure with the trade unions was accomplished.

Mondadori group: put option on Grazia and Icon brands

The Mondadori Group announces that on today’s date, Reworld Media S.A. has granted a put option through which its subsidiary Mondadori Media S.p.A. is entitled with the right to sell its Grazia and Icon business operations.

The perimeter underlying the option includes the print and digital operations of the two brands, as well as the relating international network comprising over 20 geographies with licensed publications.
In 2021, the perimeter recorded revenue of approximately € 18 million.

Under the terms of the put option, the Purchase Price has been set at €8,5 million, of which € 2 million as earn-out subject to the achievement of certain financial results in 2023, and is based on an Enterprise Value of the perimeter equal to € 11 million (including earn-out), net of the difference between the average net working capital of the last 12 months and the net working capital at closing date.

The Mondadori Group, pursuant to the provisions of law, will launch the consultation procedure with the trade unions, following which the option could be exercised.

Following the ongoing assessments, Mondadori Group will promptly disclose to the market any decision made relating to the exercise of the option and any further steps, terms and conditions of the process underlying the transaction.

The deal – the possible completion of which will also be subject to the outcome of the assessment procedure by the Offices of the Presidency of the Council of Ministers referred to in Law Decree 21/2012 – would be in line with the Mondadori Group’s repositioning strategy of increasing focus on the core business of books and on brands with greater potential for multimedia exploitation.

Mondadori Group: acquisition completed of 51% of Edizioni Star Comics

The Mondadori Group announces the completion today, through its subsidiary Mondadori Libri S.p.A., of the acquisition of 51% of Edizioni Star Comics S.r.l., Italy’s leading comic books publisher.
The transaction, which takes place in execution of the agreement signed and disclosed to the market last 6 June, will be effective as of 1 July, the date from which Mondadori will also fully consolidate the company.

As a result of the acquisition – consistent with the strategy of increasing focus on the core business of books – the Mondadori Group gains a leadership position in the domestic comic books segment, with an approximately 30% market share (GfK, in terms of value, June 2022).
Under the agreement, Simone Bovini and Claudia Bovini retain their management positions in Edizioni Star Comics, continuing to serve as Managing Directors.

The price for the acquisition of 51% of the share capital of Edizioni Star Comics – paid fully in cash today – is € 14.28 million, defined on the basis of an Enterprise Value (for 100% of the company) of € 28 million and an estimated net financial position at closing of zero.
The price will be adjusted based on the final net financial position at 30 June 2022.

The transaction, including the impact of the put&call options giving the Mondadori Group the right to increase its stake up to 100% in Edizioni Star Comics, changes the Group’s guidance for 2022 as follows:

  • free cash flow is expected to be € 10-15 million versus the previous estimate of € 40-45 million;
  • the Adjusted NFP/EBITDA ratio (IFRS16) stands at a level below 1.3x versus the previous forecast (below 1.1x).