Statement in rds30 Oct 2020 07:20
Chairman's Statement
On 25 August 2020, we announced that the Company had entered into an agreement and plan of merger, that subject to certain closing conditions would result in the acquisition of Rhapsody International Inc. (trading as "Napster"). Napster is known as the original music industry disruptor and has subsequently developed a successful business in music streaming, whose music library extends to more than 80 million tracks and serves more than 1 million subscribers across 34 countries, delivering over 1 billion music streams per month. We are hugely excited by the proposed acquisition which provides us with the opportunity to accelerate the scale of our business and to create a compelling and differentiated offering for music fans around the world. We believe that combining music streaming with immersive music performances, virtual reality and augmented reality content, live streamed events amongst further content, will provide a particularly appealing proposition for engaged music fans.
Our acquisition of one of the most iconic brands in music history will not only provide the Company with immediate global scale but also allow us to access a robust technological platform together with an experienced team. The acquisition will enable us to combine immersive visual content with music streaming, but also incorporate greater artist repertoire including video content, and live streams into a single premium subscription product. Our intention is to create the world's foremost music experience, available seamlessly across audio and visual and in turn create a truly next generation music service.
Given the nature of the transaction, our acquisition of Napster is classified as a reverse takeover and as such our shares were suspended on 25 August 2020 pending publication of an Admission Document. We are currently in the process of finalising the Admission Document process and expect this to be posted to shareholders within a short period of time.
Once live, our new application will be made available across multiple devices including smartphones, tablets, smart TV's, consoles and VR devices, in addition to audio only offerings for in-car and connected home devices such as Sonos and Amazon Echo.
The combination of the two businesses provides the Company with opportunities to secure significant operating efficiencies. Our intention is to centralise the duplicated functions into Napster's business in Seattle, USA, thereby leveraging the combined benefits of proven and established operating practices, securing material cost synergies and relocating functions where practical, to a location with closer proximity to many of our key music partners. Once the deal has completed, we will continue to focus on Napster's direct-to-consumer proposition and extend its business-to-business partnerships via existing and new partners, targeting telecommunications providers as partners with whom the benefits of our new product will showcase the
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