COMMUNIQUÉ DE PRESSE
par FOCUS HOME INTERACTIVE (EPA:ALFOC)
FOCUS ENTERTAINMENT: PulluP Entertainment is launching a capital increase by way of a public offering with a priority period, on an irreducible basis only, for the benefit of shareholders, for an init
FOCUS ENTERTAINMENT Paris, 15 May 2024, 08.30 p.m. PulluP Entertainment is launching a capital increase by way of a public offering with a priority period, on an irreducible basis only, for the benefit of shareholders, for an initial gross amount of €17.45m secured by commitments of a minimum 78.2% of this amount A voluntary operation to strengthen the Group’s financial situation and seize development opportunities as part of its new developer/publisher strategy around three business lines Availability of the Prospectus
PARIS, FRANCE – 15 May 2024 – PULLUP ENTERTAINMENT (FR0012419307 - ALPUL) (the “Company”) is launching a capital increase with shareholders’ cancellation of preferential subscription rights by way of a public offering, with a priority period in favour of the current shareholders, on an irreducible basis only, of an initial amount of €17.45 million, by issuing 1,544,348 new shares at a price of €11.30 per share (the “New Shares”) representing a discount of 3% on the volume-weighted average price of PulluP Entertainment's share price over the last three trading days preceding the date of this press release, and a discount of 3.4% versus the closing price of PulluP Entertainment's share on 14 May 2024 (the “Offering”). The amount of the capital increase may be increased to €20.07 million in the event of the exercise of the extension clause (the “Extension Clause”), and to €23.08 million in the event of the exercise of the Extension Clause and the over-allotment option (the “Over-allotment Option”). Fabrice Larue, Chairman and CEO of PulluP Entertainment: “Convinced by the growth prospects of the video game market, in 2020, my partners and I identified the full potential of Focus Home Interactive, at that point a recognised publisher, and became its largest shareholder. In 2021, we provided the Group with the resources to continue upgrading its games and invest more in development budgets while driving a deliberate studio acquisition strategy. Over the past three years, seven studios and their teams have joined the Group and numerous collaborations have been formed. We are therefore very proud of the collective successes we have achieved, which propelled the company’s publisher ranking in 2023 to fourth worldwide, as ranked by Metacritic, a foremost aggregator of video games reviews and ratings. 2023/24 was a year marked by an inflationary macroeconomic environment, which affected consumers and players, and a particularly competitive climate in our industry. In this context, we remained true to our values and our mission to offer our players and their communities unique and memorable experiences by being uncompromising on quality. At the beginning of 2024, to achieve our ambition of becoming a European leader in development and publishing on the independent and AA+ market, we announced a new organisation around three complementary business lines: Focus Entertainment Publishing, Dotemu and PulluP Studios supplemented by Scripteam. We also bolstered our Executive Committee with the appointments of Geoffroy Sardin, Deputy Chief Executive Officer, and subsequently Ahmed Boukhelifa, Deputy Chief Executive Officer of PulluP Studios. The Group’s new name, PulluP Entertainment, embodies this new operational organisation. After all of these developments, the capital increase announced today will enable us to strengthen our financial position and provide us with additional resources to plan thoroughly for the success of future releases, with several major launches already scheduled over the coming months. I would like to thank all of our talented teams, the members of the Executive Committee, the members of the Board and our partners for their commitment and their trust in the execution of the strategy that will drive profitable growth for the Group over the long term and a rebound in its results from the 2024/25 financial year." Geoffroy Sardin, Deputy CEO of PulluP Entertainment: “I am fully on board with the ambitions of PulluP Entertainment and am delighted to have been able to support this magnificent project since the beginning of the year with the most enthusiastic and creative of teams. Every day, I see the success of our strategy consolidated by the work carried out and the unique experiences created by the Group’s talented teams. As this new financial year gets under way, we already have a line-up of 65 projects to be launched over three years, thus crystallising our medium-term objective to have a revenue mix that is 50% owned IP and 50% co-owned IP. 2024/2025 promises to be a year of growth and we expect to see a rebound in our results with significant new titles, including Warhammer 40,000: Space Marine 2 scheduled to be launched on 9 September 2024. We will continue to be financially disciplined and efforts will be intensified to take full advantage of synergies from our new, fully performance-focused organisation. As Deputy Chief Executive Officer and new shareholder, on the occasion of this capital increase, I would like to confirm my commitment and also express my thanks to the talented teams, the members of the Executive Committee, the members of the Board, our partners and our shareholders for their trust in giving PulluP Entertainment the means to achieve its ambitions."
For the second half of the financial year ended 31 March 2024, PulluP Entertainment now expects a strong increase in EBITDA compared to the first half of 2023/24 thanks to the excellent performance of the back-catalogue supported by regular additional content, the good performance recorded on several games as well as the positive contribution of acquisitions. Despite the adjustment of the value of the gaming portfolio, EBITA should come out slightly positive (vs an initial slightly negative anticipation). This upward adjustment derives from the recognition of certain expenses as exceptional elements and not anymore as operating ones.
The net proceeds of the Offering will be used by the Company as follows:
In the event that the Offering is only subscribed at 78.2%, the funds raised will be allocated in priority to reduce Company’s net debt and the remainder will be used for development opportunities.
Legal framework and structure of the Offering By decision dated 14 May 2024, the Company’s Board of Directors, on the basis of the delegation of authority granted by the Ordinary and Extraordinary General Meeting of 12 September 2023 in its ninth (9th) resolution, decided to proceed with the launch of a capital increase with cancellation of shareholders’ preferential subscription rights by way of a public offering and with a priority period, on an irreducible basis only, for the benefit of the shareholders. The exercise of the Over-allotment Option will be decided, where applicable, on 23 May 2024 by the Board of Directors in accordance with the delegation of authority granted by the Ordinary and Extraordinary General Meeting of 12 September 2023 in its twelfth (12th) resolution. Issuance amount and number of New Shares to be issued The maximum gross amount of the Offering is €17.45 million (including issuance premium), i.e. a net amount of €16.91 million, which is likely to give rise to the issuance of a maximum number of 1,544,348 New Shares. If the Extension Clause is fully exercised, the maximum gross amount of the Offering will be increased to approximately €20.07 million (including issuance premium), i.e. a net amount of €19.52 million, which is likely to give rise to the issuance of a maximum total number of 1,776,000 New Shares. If the Extension Clause and the Over-allotment Option are exercised in full, the maximum gross amount of the Offering will be increased to an amount of €23.08 million (including issuance premium), i.e. a net amount of approximately €22.53 million, which is likely to give rise to the issue of a maximum total number of 2,042,400 New Shares. New Shares not subscribed for within the priority period will form part of a global offering, including (i) a public offering in France mainly intended for natural persons (the “Public Offering”); and (ii) a global placement intended for institutional investors (the “Global Placement”) carried out in the European Economic Area (including France). Subscription price The subscription price of the New Shares under the Offering is set at €11.30 per share (the “Offering Price”), including a par value of €1.20 and an issuance premium of €10.10 , to be fully paid up in cash upon subscription. The Offering Price will be identical for the priority period, the Public Offering and the Global Placement. The Offering Price was determined by the Company’s Board of Directors, acting in accordance with the terms of the delegation of authority granted by the Ordinary and Extraordinary General Meeting of 12 September 2023 in its ninth (9th) resolution[1]. The Offering Price shows a discount of 3% on the volume-weighted average price of PulluP Entertainment's share price over the last three trading days preceding the date of this press release, and a discount of 3.4% on the closing price of PulluP Entertainment's share on 14 May 2024. Terms of subscription Priority period The capital increase will entail the cancellation of shareholders’ preferential subscription rights and will take the form of a public offering with a priority period, on an irreducible basis only, in favour of the shareholders (the “Capital Increase with Priority Period”) of five consecutive trading days, from 16 May 2024 to 22 May 2024 (inclusive) at 5 p.m. (Paris time), for shareholders whose shares are registered in their accounts by 15 May 2024. This priority period is neither transferable nor negotiable. These shareholders will benefit from this priority period on an irreducible basis only, during which they will have, in proportion to the number of shares they hold on 15 May 2024, an irreducible priority to subscribe for New Shares issued under the Offering up to their share in the Company’s capital. It will not be possible to subscribe on a reducible basis within the priority period. The exercise of this priority period will be conditional upon the existing shares held by the shareholder concerned and used for this purpose being held until the end of the priority period, i.e. until 22 May 2024 (inclusive), with Uptevia (90-110 Esplanade du Général de Gaulle, 92931 Paris La Défense Cedex, France) where shares registered in a pure registered account are concerned and with the financial intermediary where registered administered shares and bearer shares are concerned. In practice, each shareholder may place a priority and irreducible subscription order relating to a number of New Shares corresponding to (i) the maximum number of New Shares available under the Offering (i.e. 1,544,348) multiplied by (ii) their share in the Company’s share capital as at 15 May 2024 (corresponding to (a) the number of Company shares that they hold (and which are locked up) as at 15 May 2024, divided by (b) 6,496,526 (the number of existing shares)). The number of New Shares allotted shall be rounded down to the nearest whole number. By way of derogation, any shareholder who, by application of this rule, has the right to subscribe for less than one New Share will have the right to subscribe for one New Share. Shareholders wishing to subscribe for a number of shares equal to or less than the number of New Shares to which they are entitled within the priority period may not have their share reduced below this number (subject to the rounding down rule for the number of New Shares allotted) and will be certain of being served in full, regardless of the final amount of the Offering. Shareholders wishing to subscribe for more than the number of shares to which they are entitled within the priority period must do so by placing an order as part of the Public Offering or the Global Placement, which will then be processed without priority over orders placed by any other investor subscribing under the Public Offering or as part of the Global Placement. By way of illustration, a shareholder who holds 0.01% of the capital (i.e. 64,965 shares) may subscribe on an irreducible basis for a maximum number of New Shares equal to 0.01% of the initially planned number of New Shares, i.e. up to 154 New Shares, with the certainty of being served in full, regardless of the final amount of the Offering. Any fraction of their order that exceeds this number of New Shares shall constitute an additional order, which shall be processed without benefiting from any priority. Global Placement and Public Offering New Shares that have not been subscribed within the priority period, as well as the New Shares to be issued, if applicable, in the event of the exercise in whole or in part of the Extension Clause and the Over-allotment Option, will be the subject of a global offering comprising:
Orders placed under the Public Offering and the Global Placement may be reduced depending on the level of demand and the number of New Shares subscribed by shareholders during the priority period. If the total number of shares requested under the Public Offering and the Global Placement is greater than the number of securities allocated to the Public Offering and the Global Placement, reducible orders placed under the Public Offering and the Global Placement will be reduced proportionally. Commitments to subscribe for the Offering Neology Holding, the Company’s reference shareholder[2], has undertaken to subscribe up to its share of the capital (i.e., 661,524 New Shares) within the priority period on an irreducible basis and, above its share, under the Public Offering up to (i) a maximum ex-post holding of 49.9% of the capital or theoretical voting rights, and (ii) a maximum total amount comprised between €13.89 million, or 1,229,593 New Shares (in the absence of exercise of the Extension Clause and the Over-allotment Option), and €16.70 million, or 1,478,121 New Shares (in the event of full exercise of the Extension Clause and the Over-Allotment Option). Otus Capital Management, a shareholder of the Company, has irrevocably committed to subscribe to the Offering up to €1.65 million, representing 146,000 New Shares (9.45% of the number of New Shares initially planned). Given the maximum ex-post holding limit of 49.9% of the capital or theoretical voting rights set in the subscription commitment of Neology Holding, the irrevocable subscription commitments collected together represent a minimum of 78.2% of the number of New Shares initially planned, corresponding to (i) 1,061,511 New Shares for Neology Holding (ie €12.00 million and 68.74% of the number of New Shares initially planned), and (ii) 146,000 New Shares for Otus Capital Management (ie €1.65 million and 9.45% of the number of New Shares initially planned). Furthermore, Mr Geoffroy Sardin, Deputy Chief Executive Officer of the Company, has undertaken to acquire 13.275 shares from Neology Holding at a price of €11.30 each (corresponding to the Offering Price) within three working days of the settlement-delivery date of the Offering scheduled for 28 May 2024. The Company is not aware of subscription commitments of other shareholders or members of its administrative or management bodies regarding their participation in the Offering. Abstention and holding commitments The Company entered into an abstention commitment for a period of 90 days from the settlement-delivery date of the New Shares, subject to usual exceptions. Neology Holding entered into a lock-up commitment for 100% of the shares that it holds and/or that it may come to hold through the exercise of any securities giving access to the share capital, including shares of the Company subscribed for under the Offering, until the expiry of a period of 180 calendar days following the settlement-delivery date of the Offering, subject to usual exceptions. Advisors Bank Degroof Petercam SA/MV has been appointed financial advisor, global coordinator and bookrunner in respect of the Offering (the “Bank”). Jeantet has been appointed legal counsel to the Company in respect of the Offering. Guarantee The placement of the New Shares shall be carried out by the Bank under the terms of a placement agency agreement entered into with the Company. The Offering is not subject to a placement guarantee from the Bank and the placement agency agreement does not constitute a performance guarantee (garantie de bonne fin) within the meaning of Article L. 225-145 of the French Commercial Code, nor does it constitute an underwriting commitment (engagement de prise ferme). In addition, in the event of termination of the placement agency agreement as per its terms and conditions, this information will be the subject of a press release published by the Company and a notice published by Euronext. The Offering will be cancelled by the Company if subscriptions received on the delivery-settlement date do not reach a minimum of 75% of the initial amount of the Offering. If the 75% threshold is not reached or the depositary certificate is not issued, this information will be the subject of a press release published by the Company and posted online on the Company’s website and a notice published by Euronext. If the Offering is cancelled, all subscription orders placed will then be rendered null and void. It is however recalled that the irrevocable subscription commitments collected under the Offering together represent a minimum of 78.2% of the number of New Shares initially planned (see above). Indicative timetable
Availability of the Prospectus The prospectus approved by the French Financial Markets Authority (“AMF”) on 15 May 2024 under number 24-156 (the “Prospectus”) consists of:
Copies of the Prospectus are available free of charge at the registered office of the Company, Parc de Flandre “Le Beauvaisis”, Bâtiment 28, 11 rue de Cambrai, 75019 Paris, on its website (www.pullupent.com) and on the AMF website (www.amf-france.org). The approval of the Prospectus should not be considered as a favourable opinion by the AMF on the securities offered. Investors are invited to carefully consider the risk factors described in section 3 “Risk factors” of the Registration Document, and Section 2 “Risk Factors” of the Securities Note. The list of these risks is not exhaustive. There may be other risks not yet identified or considered immaterial by the Company at the date of approval of the Prospectus. Prospective investors should read the Prospectus carefully before making an investment decision in order to fully understand the potential risks and benefits associated with a decision to invest in the securities. The approval of the Prospectus by the AMF should not be considered as a favourable opinion on the securities offered. About PulluP Entertainment With over 600 employees based mainly in Europe, the PULLUP ENTERTAINMENT group is organized around three complementary business units: FOCUS ENTERTAINMENT PUBLISHING, one of the world's leading AA video game publishers, renowned for its premium production services, marketing, and communications support tailored to each project and audience. The company publishes international hits such as the A Plague Tale franchise, SnowRunner and the eagerly-awaited Warhammer 40,000: Space Marine 2. DOTEMU, leading publisher and developer in the thriving independent games scene, specializes in the production of licensed games such as the million-sellers Teenage Mutant Ninja Turtles: Shredder's Revenge and Streets of Rage 4. Its Arcade Crew label also produces and publishes awesome indie and innovative games such as Blazing Chrome, Infernax and The Last Spell. As part of the Group's new organization, DOTEMU is the entity responsible for publishing all PULLUP ENTERTAINMENT's independent games. PULLUP ENTERTAINMENT STUDIOS, which groups together seven creative studios :
PULLUP ENTERTAINMENT's Human Resources, Legal and Finance support functions, as well as the Technical Department, which includes the IT, Data and Customer Relations divisions, are all housed within PULLUP ENTERTAINMENT. All financial information pertaining to PULLUP ENTERTAINMENT can be found at www.pullupent.com
FY 2023/24 results: 20 June 2024 after the market closes |