Music Choice raises £50m as IPO is four times subscribed

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The Independent Online

Music Choice Europe yesterday went public, raising £50m to promote and expand the digital music television channels which it delivers via satellite across the Continent.

Music Choice Europe yesterday went public, raising £50m to promote and expand the digital music television channels which it delivers via satellite across the Continent.

In an initial public offering in London, the flotation price was set at 162p per share, valuing the company at £196m. Some 30.8 million shares were placed with 98 different institutions throughout Europe, in an issue four times subscribed.

The company operates 47 digital audio channels and has 5 million subscribers. None of Music Choice's current backers, who include BSkyB, Sony and Time Warner, are selling shares in the placing. BSkyB will be the largest shareholder with 36.4 per cent, while Time Warner and Sony between them will have 24.6 per cent.

Simon Bazalgette, the chief executive of Music Choice, said: "It's been a fantastic response in what has been a slightly nervous market, and a great validation of the strength of our business model."

Music Choice yesterday said it would spend £20m to develop a content management system and interactive TV applications. It plans to invest another £20m in marketing, with a further £3.7m to be used to pay off a loan facility.

Last year Music Choice made a loss of £12.6m on turnover of £2.5m.

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