Deezer, the music streaming platform backed by Saudi billionaire Prince Alwaleed bin Talal, plans to go public within 18 months, depending on market circumstances, its chief executive said.
The company dropped previous plans for an initial public offering in October 2015 after it failed to convince investors. It had expected to raise $329 million (Dh1.2 billion) at the time.
"Going public is an opportunity… it is something that we will consider in the next 12 to 18 months," Hans-Holger Albrecht told The National.
"We know financial markets love music streaming companies as you saw in the case of Spotify [which went public with $26.5bn valuation in April 2018]. As a company, we are of the right size… we will raise an IPO, if everything goes well," said Mr Albrecht, without disclosing further details.
Deezer, whose main shareholders include French tycoon Xavier Niel, telecom company Orange and leading music groups Universal, Sony and Warner Music, is not looking to raise new money right now.
“We can raise new money and we also know what to do with that, but it is not on our agenda right now,” said Mr Albrecht. “Deezer is well-funded and currently in a very fortunate situation.”
Founded in France in 2007, Deezer entered the Middle East and North Africa in October last year. It has 14 million monthly active users in 185 countries and offers more than 56 million tracks and other content on a range of mobile devices.
"We started from zero last year and we are aiming [for] 4 million registrations to our service in Mena," said Mr Albrecht, who expects maximum growth coming out of the UAE, Saudi Arabia and Egypt in the coming months. He did not disclose the number of paying subscribers in the region.
Deezer will launch new audio services such as podcast and comedy shows in the region in the next few months as it aims for 10 per cent growth in subscriber numbers.
“Our plan is to go beyond music and produce original audio content for Mena customers in [the] next two years. It will include podcasts, audio books, talk shows and comedy shows,” added Mr Albrecht.
Deezer's audio services are available in other markets, such as Europe and Latin America but the company is investing in new, local production facilities in Mena. Without disclosing an investment figure, Mr Albrecht said it will be "significant" and the region is their "top priority".
“For us, Mena is not just a small region like it could be for Apple or Amazon. We really want to build our strong presence here,” he added.
“Though this region is still small in revenues but our interest is driven by potential. Music streaming penetration is very small in Mena, less than 2 per cent of the population, whereas in other markets like Scandinavia it is more than 40 per cent.”
In August 2018, Deezer secured an investment of 1 billion Saudi riyals (Dh979m) from Prince Alwaleed’s Kingdom Holding Company and Rotana Group in a private placement that valued the company at around $1.10bn, analysts said at the time. More than 100 Arabic artists are signed to Rotana, including Mohammed Abdo, Elissa and Asallah.
Alongside the deal, Rotana and Deezer signed an exclusive long-term agreement to distribute the music company’s Arabic digital audio and video content across the region.
The company aims to grow its user base in Mena to rival that of homegrown streaming service Anghami (which has more than 55 million users worldwide), Spotify, Apple Music, YouTube and others, as one of the biggest providers of Arabic music and content.
It is also eyeing exclusive partnerships with Mena telecom companies to scale up their business. Deezer has partnered with 45 operators globally.
“We are at final stages of negotiations with some local companies and will make announcements in the next couple of months,” added Mr Albrecht.