The proposed merger between Casta Diva Group and Blue Note gets the green light

June 9, 2016

The Boards of Directors of Blue Note S.p.A. and Casta Diva Group S.r.l. have approved the plan, drawn up in accordance with Article 2501-ter of the Civil Code, for the merger through the acquisition of Casta Diva Group into Blue Note and the related appendices.

Founded in 2005, Casta Diva Group is a leading international communication company in the production of digital and video content in the communication field and is active in the organization of events in the areas of show business, culture and sport. Casta Diva Group operates on four continents with offices in 13 cities and ended 2015 with consolidated revenues of €20.2m, an EBITDA of €1.6m and an “active” (cash) net financial position of €0.4m.

The combined entity, which will take the company name of Casta Diva Group S.p.A., will result in integration of the activities of Blue Note and Casta Diva Group with the aim of jointly developing their traditional core businesses, creating synergies between their activities and sharing know-how. In order to support the growth and joint development programmes of the company resulting from the business combination, a share capital increase is being studied which will be proposed as an option to the existing shareholders and to the market with a view to expanding the float after finalization of the merger operation.

As communicated to the market on 30 March 2016, Blue Note and Paolo Colucci (majority shareholder of Blue Note) and Casta Diva Group, Reload S.r.l. (single member of Casta Diva Group), Andrea De Micheli and Luca Oddo (holders of the majority interest in Reload S.r.l.) signed a Framework Agreement which governs, in a binding manner, the times, conditions, terms and methods of execution of the merger.

On 20 May 2016 the parties made a few modifications to the Framework Agreement, leading to the deferment of deadlines, which were communicated to the market on the same date. The merger will be decided on the basis of the financial statements of Blue Note and Casta Diva Group for the year ended 31 December 2015, which therefore function, as provided by Article 2501-quater, paragraph 2 of the Civil Code, as merger financial positions.

In the context of the business combination, Blue Note will implement the merger by issuing new shares to assign to the sole member of Casta Diva Group as a function of the following exchange ratio: for each registered share of 1 (one) euro of the company capital of Casta Diva Group, the shareholder of Casta Diva Group will receive 81,328 ordinary no-par value shares of Blue Note, without money adjustments.

In service to the share exchange, Blue Note will issue 9,035,540 ordinary no-par value shares and will increase its overall capital to €3,562,618.

Blue Note’s Board of Directors also set the liquidation value of the shares in case of withdrawal: due to the merger, and in particular on account of the modifications that will be made to Blue Note’s corporate purpose as stated in its articles of association, its members have been given the right of withdrawal in accordance with Article 2437 et seq. of the Civil Code. The unit liquidation value of the ordinary shares is €2.30. The share exchange ratio will not be influenced by any exercise of the right of withdrawal by the members of Blue Note.

Finally, Blue Note’s Board of Directors voted to call a shareholders’ meeting, on 18 July 2016 on first call and, if necessary, on 19 July 2016 on second call, at the company’s registered office in Via della Moscova 18, 20121 Milan, to discuss and vote on the following agenda:

Extraordinary part
Proposal of merger by acquisition of Casta Diva Group S.r.l. into Blue Note S.p.A. Related and consequent resolutions, pursuant to and in accordance with Article 49, paragraph 1, letter g) of Consob Regulation 11971/1999 as subsequently amended;
Revocation of the resolution of approval of the merger plan between Blue Note S.p.A. and Blue Note Eventi S.r.l.; related and consequent resolutions.

Ordinary part
Granting of the external auditing appointment and certification of the company’s financial statements; related and consequent resolutions.
Appointment of administrative body; related and consequent resolutions.
Appointment of board of statutory auditors; related and consequent resolutions.

In addition, it was announced that certification has been issued without qualifications by the auditor of Casta Diva Group’s separate and consolidated financial statements for the year ended 31 December 2015. The parties agreed not to request certification of the consolidated pro forma data as at 31 December 2015 as not necessary in consideration of the fact that the pro forma adjustments are limited and easily understandable. In this sense, as provided by Consob Regulation 11971/1999 in Annex 3B, Table 1, point 5, the simplifying case in the cited paragraph 5.1.2 was applicable and, in alternative to the pro forma financial positions and income statements, an explanatory report was prepared on the pro forma effects deriving from the operation which will be included in the information document. For the foregoing reasons, the parties waived the related condition subsequent.

In addition, it was announced that the time limit for approval of the merger operation by the meeting of Blue Note’s shareholders has been extended to 19 July 2016. Finally, it was pointed out that the Framework Agreement remains unchanged for what regards the other conditions subsequent subject to any waiver, which will be promptly communicated to the market.

ADDITIONAL INFORMATION

The Board of Directors of Casta Diva Group approved the merger plan and the related illustrative report by the directors in accordance with Article 2501-quinquies of the Civil Code. The administrative body also voted to call a general meeting of members on 18 July 2016, at the company’s registered office in Via Lomazzo 34, 20154 Milan, to discuss and vote on the following item on the agenda:

Proposal of merger by acquisition of Casta Diva Group S.r.l. in Blue Note S.p.A.
Related and consequent resolutions.

In accordance with Article 2501-septies of the Civil Code, the merger plan will be made available to the members and the public within the legal deadlines at the registered office of Blue Note (Via della Moscova 18, Milan) and at the registered office of Casta Diva Group (Via Lomazzo 34, Milan), and will also be viewable on Blue Note’s website (www.bluenotemilano.com) together with (i) the reports in Article 2501-quinquies of the Civil Code; (ii) the merger financial positions; (iii) the financial statements relating to the Casta Diva Group for the periods ended on 30 June 2013, 30 June 2014 and 31 December 2014; and (iv) the financial statements relative to the periods of Blue Note ended on 31 December 2013 and 31 December 2014. The report on the fairness of the share exchange ratio drawn up by the joint expert Deloitte & Touche S.p.A. will be made available in the same ways and for the same purposes in accordance with Article 2501-sexies of the Civil Code.

In the 15 days leading up to the date of the meeting, in accordance with Article 2437-ter of the Civil Code, the illustrative report of the administrators on the liquidation value of the company’s ordinary shares for the purposes of withdrawal, together with the opinion of Blue Note’s Board of Statutory Auditors and the report of Reconta Ernst & Young S.p.A., it too drawn up in accordance with Article 2437-ter of the Civil Code, will be made available to the members of Blue Note at its registered office (Via della Moscova 18, Milan), also viewable on the website www.bluenotemilano.com.