Deezer dares the second attempt for an IPO.

The French music streaming service announced earlier this week that it would be merging with the special purpose vehicle I2PO.

This is a so-called Special Purpose Acquisition Company (SPAC), which was launched last year to raise capital and take companies public.

The merger with the SPAC saves Deezer a lot of time.

If the shareholders of both companies give the green light, the IPO on the Paris Euronext should take place in July.

Benjamin Fisher

Editor in Business.

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The signs are good and better than seven years ago, when the IPO was canceled due to the difficult market environment at the time.

Most shareholders of the streaming service have already pledged to participate in the capital increase – Deezer is to receive at least 135 million euros.

These include the largest shareholder with around 40 percent, the investment company of the oligarch Leonard "Len" Blavatnik, Access Industries, the French media mogul Xavier Niel, the Saudi Kingdom Holdings and the music companies Universal Music and Warner Music.

Access Industries also holds the majority of shares in Warner.

Valuation of around one billion euros

Celebrities from the banking and media sectors are behind the SPAC called I2PO.

One of them is the French billionaire François-Henri Pinault, head of the luxury goods group Kering, known for brands such as Gucci and Bottega Veneta.

Also on board are the Frenchman Matthieu Pigasse, businessman and co-owner of the daily newspaper "Le Monde", and the German Iris Knobloch, former manager of the American media group WarnerMedia and recently President of the Cannes Film Festival.

In the course of the merger, Knobloch is to advance to the top of the Deezer supervisory board.

Jeronimo Folgueira will remain at the top of the board.

Last year, the Spaniard followed the German Hans-Holger Albrecht, brother of EU Commission President Ursula von der Leyen.

Deezer's valuation is estimated at around 1.075 billion euros as a result of the IPO.

Founded in 2007, the streaming service operates in a highly competitive market dominated by Swedish market leader Spotify.

This has around 180 million subscribers, followed by the streaming services of the US companies Apple, Amazon and Youtube.

Although Deezer is now also represented in 180 countries, it is much smaller and currently has 9.6 million subscribers, around half of them in the home market of France.

"It's not the services that make the big bucks"

But I2PO is convinced that Deezer can hold its own against the powerful competition.

Thanks in part to its competitive technology, the streaming service is able to “gain a significant share of the booming growth in music streaming,” announced the future head of the supervisory board, Knobloch.

Deezer's annual sales are expected to increase from around EUR 400 million to EUR 1 billion in 2025, according to the announcement earlier this week.

From then on, Deezer should also be in the black;

last year the operating loss was 120 million euros.

Deezer, like its competitors, distributes around two-thirds of its total income to the rights holders of the music.

"It's not the services that earn the big money," emphasized Folgueira in an interview with the FAZ

Meanwhile, in mid-February, Deezer was the first major service in Germany to say goodbye to the standard price of EUR 9.99 per month.

After price increases in France and Great Britain, the single subscription in Germany now costs 10.99 euros for new customers.