M&A

The Mondadori Group announces the conclusion today, through its subsidiary Mondadori Libri S.p.A., of the acquisition of 50% of A.L.I. S.r.l. – Agenzia Libraria International, a company operating in the distribution of books and boasting a client portfolio of over 80 publishers. The transaction takes place in execution of the agreement signed and disclosed to the market last 11 November 2021.

Thanks to this acquisition, the Mondadori Group takes a further step along the path of increasing focus on the books market, through a process of vertical integration that allows the Group to strengthen its position in the promotion and distribution of third-party publishers, with a view to continually improving the service level and expanding the customer portfolio.

As already disclosed, the scope of the transaction includes a number of subsidiaries operating in the publishing field.
The acquisition price, paid in cash on today’s date, is € 10.8 million.

The 50% stake in A.L.I. will be consolidated at equity effective as from 1 May 2022.

The final agreements envisage the acquisition by the Mondadori Group of a further 25% stake in A.L.I., effective as from 28 February 2023, at a price to be set based on average EBITDA 2021-2022. As from 1 March 2023, the company will be then fully consolidated.

The deal also governs the subscription of put&call options, which give Mondadori the right to acquire the remaining 25% of A.L.I. by 30 July 2025 at a price to be set based on average EBITDA 2023-2024.

The members of the Belloni family, the founders of A.L.I., will keep their roles of responsibility in the operational management of the company.

The closing of the acquisition follows the authorization by the competent Antitrust Authority, disclosed on 7 March 2022.

Mention should be made that the 2022 guidance (in particular the estimated Free Cash Flow), disclosed on 16 March, included the financial effects of the above transaction.

The Mondadori Group announces the closing today, through its subsidiary Mondadori Libri S.p.A., in execution of the agreement signed and disclosed to the market last 22 November 2021, of the acquisition, from De Agostini Editore, of a 50% stake in the share capital of De Agostini Libri S.r.l., formerly DeA Planeta Libri, specialized in trade books with focus on the children’s and non-fiction segments.

As already disclosed, the scope of the deal includes Libromania S.r.l., wholly-owned by De Agostini Libri and active in the promotion of third-party publishers: the agreements reached include put&call options, exercisable in second half 2022, which entitle the Mondadori Group to acquire 100% of Libromania.

The total maximum value of the acquisition, taking account of the 100% valuation of Libromania, is set at € 4.5 million.

The transaction, which creates a partnership with a time-honoured publishing house boasting a strong heritage and know-how, is in line with the repeatedly announced strategy of increasing the focus on the core business of books, pursued also through a process of vertical integration in the books market.

In 2021, De Agostini Libri reported consolidated revenue of € 13.9 million and EBITDA of € 0.2 million.

The corporate governance structure entitles the Mondadori Group to fully consolidate the stake.

Closing of the acquisition follows the authorization issued by the Antitrust Authority as disclosed last 25 February 2022.

The Mondadori Group announces that it has received notice from the Antitrust Authority of the authorization to acquire – as disclosed last 11 November 2021 – a 50% stake in A.L.I. S.r.l. – Agenzia Libraria International, specialized in the distribution of books.

Following authorization from the above Authority, the transaction will be fully implemented on the closing date, which is scheduled to take place by April.

The Mondadori Group announces that it has received notice from the Antitrust Authority of the authorization to acquire from De Agostini Editore S.p.A. a 50% stake in the share capital of DeA Planeta Libri S.r.l., a transaction disclosed last 22 November 2021.

The Authority’s go-ahead triggers the fulfilment of the suspensive condition attached to the agreement on the sale of the stake; the sale will therefore be fully implemented on the closing date, scheduled by March, as from which the company will be known as De Agostini Libri S.r.l..

The Mondadori Group announces the completion today of the sale – by its subsidiary Mondadori Media S.p.A. – of the business units comprising the editorial activities of Donna Moderna and CasaFacile to Stile Italia Edizioni S.r.l., part of Società Editrice Italiana S.p.A. group.
In 2021, revenue from these activities is estimated at approximately € 17 million.

The transaction, which will be effective as from 1 January 2022, is in line with the Mondadori Group’s strategy – repeatedly disclosed to the market – of increasing its focus on the core business of books.

In accordance with the provisions of law, the procedure with the trade unions was put into effect.

The Mondadori Group, in execution of the agreement signed and disclosed to the market last 12 July, announces that it has finalized the acquisition today of 100% of De Agostini Scuola S.p.A. through its subsidiary Mondadori Libri S.p.A..

Completion of the transaction follows the authorization issued by the Antitrust Authority as disclosed last 8 November.

The provisional price paid for the acquisition is € 135.7 million, defined on the basis of an Enterprise Value of € 157.5 million, net of the average normalized net financial position of 2020: the final price will be determined on the basis of the average normalized net financial position of 2021.

The agreed Enterprise Value of € 157.5 million is equal to 7.4 times the reported EBITDA of De Agostini Scuola in 2020.

Considering the financial impacts of the transaction (payment of the consideration and consolidation of the financial position of De Agostini Scuola), the Mondadori Group’s consolidated NFP before IFRS16 in 2021, which, on approval of the results at 30 September 2021, envisaged a positive pre-acquisition guidance of approximately € 35 million – is expected to amount to approximately € -100 million.

Accordingly, on a pro-forma level, the NFP/reported EBITDA ratio before IFRS16 – as per the definition of the covenant of the current loan lines – is expected to be lower than 1.0x, while the NFP/adjusted EBITDA ratio (IFRS16) is expected to be lower than 1.5x.

Thanks to this deal, the Mondadori Group strengthens its foothold in the education segment: De Agostini Scuola will in fact join, under the new name of D Scuola S.p.A., Mondadori Education and Rizzoli Education, bringing the total pro-forma 2021 market share to 32.9%.

The Group thus becomes the top player on the textbooks publishing market, leveraging on the names of three solid publishers, each with a distinctive identity and longstanding tradition, a point of reference in the world of teaching and learning, consistent with the strategy of focusing on the core business of books.

The consideration was settled in cash today by drawing on the acquisition-related line of credit, defined as part of the loan agreement signed on 12 May, and on available liquidity.

The balance sheet amounts of the investment will be consolidated as at 31 December 2021, with income statement effects as from 1 January 2022.

The Mondadori Group announces the signing of an agreement on the acquisition from De Agostini Editore S.p.A. – owner of the entire share capital – of a 50% stake in DeA Planeta Libri S.r.l., to be renamed De Agostini Libri S.r.l., specialized in trade books with focus on the children’s and non-fiction segments.

The corporate governance structure entitles the Mondadori Group to fully consolidate the company.

The scope of the deal includes Libromania S.r.l., wholly-owned by De Agostini Libri and active in the promotion of third-party publishers: the agreements between the parties include put&call options, exercisable in second half 2022, which entitle the Mondadori Group to acquire 100% of Libromania.

In 2021, De Agostini Libri is expected to record consolidated revenue of approximately € 12.6 million, while EBITDA is forecast at break even.

The total maximum value of the transaction, taking account of the 100% valuation of Libromania, has been set at € 4.5 million.

Thanks to the acquisition, the Mondadori Group, – consistent with its strategy of increasing focus on the core business of books – forms a partnership with a publishing house that boasts a rich history and tradition, as well as solid know-how.

While the transaction in itself is irrelevant for the purposes of Antitrust reporting obligations, in accordance with the relevant legislation, it is subject to the Authority’s authorization, given the involvement of the same parties (the Mondadori Group and De Agostini Editore) in the De Agostini Scuola deal.

The Mondadori Group announces that it has received notice from the Antitrust Authority of the authorization to acquire 100% of De Agostini Scuola S.p.A. as disclosed last 12 July.

The provision envisages the adoption of appropriate behavioural measures, as indicated by the Authority and shared by the Mondadori Group, to safeguard the competitiveness of the school textbooks market, including, in particular, the commitment to continue to keep De Agostini Scuola separated until 31 December 2024.
These remedies confirm the rationale of the acquisition, the business development plan and the potential for value creation initially estimated by the Group.

“We are really delighted to be able to go ahead with the acquisition of De Agostini Scuola, a deal consistent with our strategy of focusing on our core business of books”, said Antonio Porro, CEO of the Mondadori Group. “The investment – the most relevant made in the last 15 years – will allow us to open up a new chapter in the path of growth of our Group and to achieve a leadership position in the school publishing market”, concluded Porro.

The Authority’s go-ahead triggers the fulfilment of the suspensive condition attached to the agreement on the sale of the investment in De Agostini Scuola; the sale will therefore be fully executed on the closing date, scheduled to take place later this year.

The Mondadori Group announces the signing today of an agreement with De Agostini Editore S.p.A. – following the negotiations disclosed on 1 July – for the acquisition of 100% of De Agostini Scuola S.p.A., one of Italy’s top school textbook publishers.

The company’s products are targeted to every level of education – with a marked presence especially in the secondary school segment – through a series of brands including DeA Scuola, Petrini, Marietti Scuola, UTET Università, Cideb-Black Cat and Garzanti Scuola.

The transaction is consistent with the strategy – repeatedly announced by Mondadori – of focusing on the core business of books, in which the Group boasts a longstanding leadership in Trade and is one of the top school textbook players. The acquisition will enable the Company to further strengthen its foothold in the school textbook field, where it currently operates through the publishing houses Mondadori Education and Rizzoli Education.

The value of the transaction has been defined on the basis of an Enterprise Value of € 157.5 million, equal to 7.4 times the reported EBITDA recorded by De Agostini Scuola in 2020. The price will be defined on the basis of the average normalized net financial position over the 12 months before the closing date.

De Agostini Scuola posted in 2020 revenue of € 70.8 million, reported EBITDA of € 21.4 million, with a margin of 30%, and net profit of € 12.2 million. At 31 December 2020, the net financial position stood at a positive (net cash) € 20.8 million.

The agreement, which also makes all of the brands currently covering De Agostini Scuola’s school textbook publishing market available to the Mondadori Group, includes the typical representations and warranties for the purchaser.

The consideration for the transaction will be settled in cash at the closing date by drawing on the acquisition-related line of credit, recently defined as part of the loan agreement signed by the Group on 12 May.

Completion of the transaction is subject to the authorizations of law from the competent Antitrust authority.

Mention should be made that the forecasts developed for the current year on the Mondadori Group, previously disclosed to the market, have been prepared on the basis of the current scope; any updates to the above estimates will be announced with a view to the time required to complete the transaction.

The Mondadori Group Management will meet with the financial community at a conference call scheduled today at 6pm. The relevant presentation will be available on 1info (www.1info.it) and on the website www.gruppomondadori.it (Investors section).

With regard to the news reports published today, the Mondadori Group hereby informs that negotiations are underway for the acquisition of 100% of De Agostini Scuola S.p.A., a school textbooks publisher owned by De Agostini Editore S.p.A..

The ongoing process, which follows the acceptance of a binding offer, envisages the signing of the contract subject to the successful outcome of further important stages, such as the sharing between the parties of specific contractual terms being discussed and the positive completion of confirmatory due diligence activities by the Mondadori Group.

The transaction would be consistent with the repeatedly announced strategy of focusing on the core business of books, in which the Mondadori Group boasts a longstanding leadership in Trade and is one of the top school textbooks players.

Completion, if any, of the transaction will be promptly disclosed to the market and would be subject to the authorizations of law by the competent Antitrust authority.