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Swedish media group MTG has signed a deal to sell its majority stake in Pan-African network Trace to equity firm TPG Growth.
The agreement, which still has to pass regulatory approval, is for 75 percent of Trace and values the entire company at just under $50 million (€40 million). Founded in 2003 and based in Paris, Trace operates 21 pay TV channels, as well as radio, film, online and mobile services that reach more than 200 million viewers and listeners across some 160 countries. Seen by many as Africa’s answer to MTV, Trace bills itself as the market leader in afro-urban music and entertainment.
MTG picked up the stake in Trace in 2014 in an all-cash deal with Trace management and equity groups Citizen Capital, Entrepreneur Venture and NextStage. Trace’s management holds the remaining 25 percent of the company.
TPG Growth has experience in the music business, as a past investor in music streamer Spotify. Past and current investments from TPG include Vice Media and Creative Artists Agency.
“The African music and entertainment industry is dynamic and has experienced huge growth in the last decade, driven by the booming youth population and rapid adoption of digital technology,” said Yemi Lalude, managing partner at TPG Africa. “As smartphone penetration on the African continent continues to rise, the way young people consume content is migrating to mobile and digital. We are very excited to help grow the Trace brand not only in Africa but worldwide.”
Olivier Laouchez, co-founder, chairman and CEO of Trace said with TPG’s investment, the group was “well-positioned to build on our success and accelerate our transformation into the leading global afro-urban digital entertainment group.”
For MTG, the deal marks a retreat from the African market. The company said its focus going forward would be the “accelerated digital transformation of our broadcasting businesses,” mainly based in Scandinavia.
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