Seloger Case Studyhj

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Axel Springer’s Creeping
Takeover of SeLoger.com
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CASE STUDY
This case was prepared by Marc Kitten, Adjunct Professor at EDHEC Business School and Maÿlis Jaillard, MSc
Corporate Finance graduate, and is intended to be used for class discussion rather than to illustrate either
effective or ineffective handling of an administrative situation. It is based on the public information that was
processed by the investment banks during the transaction.
Copyright © 2017 EDHEC Business School and Marc Kitten / Maÿlis Jaillard
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On 25 October 2010, the supervisory board of listed French online property ads website
SeLoger.com (“SeLoger”) met their financial advisors at Nomura to review the offer made by
the German publisher Axel Springer to launch a takeover bid over SeLoger’s shares. In spite
of the high stakes, board members were rather confident about the outcome of the case. The
situation was uncharacteristic, the story was unique and there were so many defendants of
SeLoger’s cause that, one thing was certain, a deal could not be reached at that price. In any
case, they had no other option but to rely on SeLoger shareholders’ decision and to make sure
that enough shareholders would not accept to sell their shares at such a low price. As
expressed in the draft reply document filed with the AMF on the following day, the minutes
of the meeting that follows summarised the supervisory board’s reasoned opinion on Axel
Springer’s offer:
« With regards to the conditions of announcement and filing of the offer, the board
immediately notices that the offer does not correspond to a friendly approach.
The willingness of Axel Springer to file its draft offer document with the AMF despite the
opposition of certain shareholders makes the board fear that the offer constitutes in fact

an attempt of creeping takeover on the company. The offer price reflects neither the
intrinsic value of the company nor its growth potential.
In addition, the board believes that the offer holds few benefits for the company, its
employees and its shareholders, as it is not part to a clear strategy to take majority control
of SeLoger.com. This could only result from the inclusion of a 50.01% minimum acceptance
threshold of SeLoger.com’s shares and voting rights on a fully-diluted basis, and an
increase of the offer price as required by the report from the independent expert in
accordance with the AMF general regulation.
Besides, the supervisory board considers that the company is able to continue its
development on a stand-alone basis as it has been doing so far.
Finally, the board notices that the offer does not mention any commitment towards the
management and employees of the company as far as incentivisation is concerned, whereas
SeLoger.com has always closely associated management and employees to the company’s
growth. »
The filing of this draft reply document followed the issuance by Axel Springer of the draft offer
document on 28 September 2010 stating its willingness to increase its 12.36% share ownership
in the company at the offer price of €34 per share.
SeLoger.com
SeLoger Group was France’s leading publisher of classified real-estate advertisement online.
At the end of 2009, over 2.284 million property advertisements were posted on its two main
websites: www.seloger.com and www.immostreet.com, which constituted the most popular
Internet marketplaces for the posting of advertisement. Aside from those two websites, the
Group also managed www.selogerneuf.com, a French portal for the sale of new property
developments, www.bellesdemeures.com, exclusively focused on the luxury property market
and www.agorabiz.com, an Internet platform dedicated to offices and business opportunities.
Belles Demeures and Agorabiz were the result of recent acquisitions realised by the Group in
2008 as part of its strategy for developing related market niches.
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In a market study conducted by Nielsen NetRatings in July 2010, Roland Tripard, chairman of
the management board and Chief Executive Officer of SeLoger.com since 20 January 2010,
was proud to hear that the company had the widest audience for property advertisements on the
Internet: 3.3 million unique visitors per month and an average time per visit of 15 minutes.
The Group's customers consisted of real estate agents, independent or members of the main
French networks (Arthur Immobilier, Century 21, ERA, Guy Hoquet, Imogroup, Laforêt
Immobilier, ORPI, etc.), connected to the Group by subscription contracts. SeLoger’s high level
of audience and the growing reputation of its websites are the key factors that help to attract
new estate agents as customers.
SeLoger’s activities were split into 3 main businesses:

- The Classified Advertisements and Media division is SeLoger’s core activity and mainly
consists of the posting of professional property advertisements, online advertising and
partnerships, as well as direct services for users
- Services encompass the Web Agency activity, which helps estate agents to develop their

own presence and their activities on the Internet (creation of personalised websites, help
with listing on search engines, maintenance, hosting, etc.), inter-agency activities, which
consist of online property files shared among real estate agents, and software marketing
- The Software sales activity provides software solutions to real estate agents. Through the
acquisition of Périclès in November 2006, the division commercialises software and
Internet platforms, used to manage the transactions of estate agents
In 2009, the Group achieved consolidated sales of €73.0 million. The revenue stream primarily
came from estate agents’ marketing budget dedicated to online classifieds. As a result, about
84% of 2009 sales came from the Media activity. Announced on 9 September 2010, half-year
turnover and EBITDA had exceeded expectations, reaching respectively €39.4 million and
€20.5 million. SeLoger’s constant growth in revenue and EBITDA amounts and the
optimization of its EBITDA margin between June 2009 and June 2010 proved the robustness
of its model in a context of a declining real estate industry. Please refer to Exhibit I for detailed
information on consolidated financial statements.
The industry and the Group’s competitive edge
When compared to French players such as A Vendre A Louer (held by Price Minister/Rakuten),
Explorimmo (Le Figaro), Logic-Immo (Spir) or Paru Vendu, SeLoger was the clear leader in
online advertisements for the real-estate industry, attracting over 50% of users’ audience
visiting real-estate ads’ websites, capturing a disproportionate share of revenues in its market
and providing agencies with a superior visibility.
Lately, online classified advertisements had suffered from the crisis that deeply hurt the real
estate industry in 2009. As a matter of facts, 17% of real estate agencies shut down. But in spite
of the depressed real estate market environment, SeLoger demonstrated a resilient performance,
with a positive 1.9% growth in 2009 and, from then on, the company was seen as being well
positioned to benefit from the coming upturn of the real estate market. Indeed, marketing
budgets of real-estate agents were expected to recover from €1,740m/month in 2009 to
€2,000/month (vs. 2,500/month in 2006). In the same way, the migration of real estate
classifieds from print to online was currently ongoing (54% of budget spent over online media
today vs. 20% in 2006).
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The two revenue drivers for the sector were the firm’s increase in penetration rate (i) and its
ability to grow in average revenue per user (ARPU) (ii). With regards to SeLoger:
i) The penetration rate as of December 2009 stood at 61% in France, of which 80% in the
Paris region and 55% in the Provinces. Although the Group initially focused its
development in the Paris Region, it had successfully expanded its businesses to the
provincial areas where the potential for growth was high considering the prevalent lower
level of Internet use compared to Paris. Moreover, substantial potential for growth exists
in Paris where there remained room for further expansion. Management was relatively
confident that it could achieve a 90% penetration rate in the Paris region and 80% in the
rest of the country.
ii) The Company’s current strategy was to expand towards higher value-added services
such as new listings on vertical portals (offices, retail, luxury, new residences, vacation
residences and individual houses), new website options (such as “Items sold” on
www.seloger.com), continued development of Multi-Listing Services and sponsored
links and advertising for related services (mortgages, car rentals, insurance, online

quotes, etc..). This desired shift in service provision should fuel future growth in the
ARPU.
When compared to further developed firms such as Rightmove in the UK and REA Group in
Australia, it seems that SeLoger’s business plan, which was younger than its two peers, should
evolve in their wake. According to its Chief Financial Officer Ivan Tortet, SeLoger Group
should catch up with REA’s KPIs level within 4 years. Its rather low capital expenditure and
working capital needs enabled the company to ensure high cash generation, with already 82.1%
cash conversion 1 realised in 2009. For the next years to come, the Group intended to rely on
internal growth to fund its external growth strategy. Indeed, SeLoger planned to expand
geographically to new areas where the real estate market on the Internet was not yet
consolidated (Eastern Europe, Latin America, South-East Asia) and to further develop in niche
markets in France so as to diversify its service offering.
Axel Springer
Established by the publisher of the same name in 1946, Axel Springer was Europe’s biggest-
selling tabloid newspaper and third-largest magazine publisher in Germany. The group was
particularly famous for 2 of its well-known multimedia brand families: the BILD and WELT
Groups. With over 230 newspapers and magazines, more than 80 online offerings for various
different information needs, as well as holdings in TV and radio stations, Axel Springer was
active in a total of 36 countries. The Group’s international activities in Eastern Europe were
centred on Poland, Hungary, Russia and the Czech Republic; in Western Europe on
Switzerland, France and Spain. Overall, the company employed 10,000 people and generated
€2.6 billion of revenues and €333.7 million of EBITDA during the 2009 fiscal year.
As of September 2010, the German media group with leading position in its country already
had a foot on the French territory. The actual structure of the Group in France resulted from a
continuous growth mainly built through various acquisitions over time. Starting with the
launch of Auto Plus magazine, the French equivalent for its German magazine Auto Bild,
created in partnership with the French media group Editions Mondiales in 1988, the German
1 Cash conversion = FCF / (EBITDA – Capex), where FCF = EBITDA – Capex – Working capital – Taxes.
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group then acquired Publications Grand Public in 2000, publisher of a wide range of
magazines distributed in supermarkets. Latterly, Axel Springer expanded its position in the
digital media marketplaces through successive acquisitions in the e-commerce sector.
Websites owned by the Group and present in France included the European women’s portal
Aufemin.com, managing several websites among which aufeminin.com and marmiton.org,
the European website Stepstone.com, a provider of recruitment solutions, the web marketing
agency zanox.com, the online information portal and shopping guide bonial.fr and the price
comparison platform Idealo.fr. Its development in France clearly illustrated its overall
strategy: internalisation and digitisation.
As far as the online real estate sector was concerned, Axel Springer’s presence boiled down to
the German real estate marketing portal Immonet.de bought in 2002, which turned out not to
be the number 1 player in Germany, lagging behind its main competitors Immowelt and
Immobilienscout.
Axel Springer’s €34 per share tender offer
On 9 September 2010, on the same day SeLoger released solid half-year results, Axel Springer
entered into an agreement with a group of shareholders to acquire a 12.36% stake in SeLoger
at a share price of €34. Before the issuance of the press release announcing the newly agreed
acquisition, Roland Tripard and his team had no idea about this existing off-market transaction
being settled. Not only did they discover that the agreement included the founders Amal Amar
and Denis Chalumeau, but also that Axel Springer intended to launch a voluntary public tender
offer for all of the remaining share capital at the same price in cash. The €34 per share offer
price represents a 13.3% premium on the closing price of the shares in SeLoger, which stood at
€30 per share on 9 September 2010 (see Exhibit II). The implied equity value for the proposed
transaction amounts to €566 million.
The management, who was concerned about how quickly things could get out of control,
wanted to prevent this operation from happening but the question was how? Pressed for time,
they had to find qualified and trustworthy teams of investment bankers and lawyers to defend
their cause. Neither Roland Tripard nor its Chief Financial Officer Yvan Tortet had any real
experience in tender offer processes. It was time to pull out the address books, and then go and
shop around!
During a meeting held on 14 September 2010, SeLoger’s supervisory board rejected Axel
Springer’s offer stating that the price of €34 per share “does not reflect the intrinsic value of
the Group, especially when considering SeLoger’s growth prospects”. In their opinion, the
offer as it stood had to be considered as of an unfriendly nature, especially given its price and
the absence of a minimum acceptance threshold. Certain shareholders also expressed their
opposition to the offer. Group Arnault, the family office of the French investor Bernard Arnault,
holding a 9.06% stake in SeLoger, publically declared on 15 September 2010:
“This offer manifestly undervalues the company with regard to its growth potential,
its profitability and its uncontested position as market leader. We therefore do not
accept it.”
Since first announcement on 9 September 2010, shares in SeLoger had steadily risen above the
offer price and closed at €38.0 on 15 September 2010. Thus, share price evolution suggested
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that the market was reacting negatively to the offer and was confident about SeLoger’s potential
for future growth and value creation. And no one could deny SeLoger’s strong track record as
a listed stock since its IPO at €20.5 per share in 2006.
In letters released by the AMF and received from the acquirer on 15 September 2010, the market
learned that AS Online Beteiligungs GmbH, an investment subsidiary of Axel Springer, had
directly crossed, on 15 September, the 5% and 10% thresholds of SeLoger’s share capital and
voting rights, representing 2,058,116 shares and voting rights, and accounting for 12.36% of
the total share capital and voting rights.
Nevertheless, in spite of the supervisory board’s objection and the rejection expressly
formulated by a group of shareholders jointly representing 49% of SeLoger.com’ share capital 2,
Axel Springer neither abandoned its offer, nor raised its €34 per share offer price, nor added a
minimum acceptance threshold. Meanwhile, on 22 September, the French media group Spir
Communication sold its shares in Leboncoin.fr to the Norwegian Schibsted for a total
consideration of €400 million, valuing the shares at 18.0x 2010 EBITDA. Exhibit III provides

a summary of recent transactions observed on the market.
On 28 September 2010, Axel Springer, advised by BNP Paribas, filed a draft offer document
with the AMF for a public tender offer on all the shares in SeLoger.com it did not hold at a
price of €34 per share. The offer document did not contain any minimum acceptance threshold.
The details about implied premia over share prices have been included in Exhibit IV. On that
same day, the supervisory board of SeLoger.com, which met to discuss the offer, reiterated its
disagreement regarding the proposed tender offer, claiming that:
- No prior agreement had been settled between both parties before the announcement,
and therefore is perceived as unfriendly.
- The €34 per share offer does not reflect the embedded value of SeLoger’s shares nor
its potential for growth.
- The lack of a clear strategic merits expressed in the draft offer document raises
doubts about Axel Springer’s willingness to create synergies between Axel Springer
and SeLoger. The supervisory board expressed its concerns that the absence of a
minimum acceptance threshold might constitute an attempt to initiate a creeping
takeover of the company.
In accordance with the supervisory board’s choice made 14 September 2010, Amal Amar and
Fabrice Robert, both involved in the 12.36% acquisition and members of the supervisory board,
were not part of this decision as they had agreed to not participate in any board meetings or
votes concerning the offer in order to avoid potential conflict of interest. Yet, sellers of the
12.36% block to Axel Springer had obviously anticipated everything: they had included in the
agreement a “top-up” clause 3 in order to align the price paid for the initial stake with that
offered to shareholders that will tender their shares to the offer.
2 Shareholders intending to reject the offer include Groupe Arnault (9.1%), Lone Pine (9.9%) and Fidelity (8.9%).
3 In case (i) AS Online (or any other subsidiary of Axel Springer’s Group) would proceed to acquire shares in the Seloger
from a third party prior to the opening of the tender offer at a higher price than the €34 per share offered for the initial stake,
and / or (ii) if the price finally paid by AS Online in the context of the takeover bid is higher than €34 per share (including the
case where AS Online would increase its offer price following a competing offer from a third party), the additional price paid
would be equal to the positive difference between that price and €34 multiplied by the number of shares transferred by the
sellers to AS Online and should be paid within ten working days following the settlement provided that the AMF gave its
approval to AS Online’s offering bid.
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On 29 September 2010, Groupe Arnault stated once more that it would refuse to sell its shares
to Axel Springer at this offered price.
SeLoger’s management and supervisory board had decided to appoint Nomura and Brandford-
Griffith & Associés as, respectively, their financial advisor and lawyer to defend their side
during the offer period. The consulting firm specialised in communication strategy Brunswick
was designated to help the management with investors and press related issues. The stakes were
high, the challenges were diverse: try to negotiate with the initiator of the offer, analyse the
feasibility of different defence mechanisms, cater shareholders’ feelings and communicate with
them about possible outcomes, try to master communication and prevent any undesired leaks,
find a white knight to improve the terms of the offer, unless a financial sponsor showed interest
in privatizing the stock and setting up a LBO structure,… The team and its three advisors had
to act wisely so as to quickly defuse the situation.
Brokers’ view on SeLoger

Within a short period of time, all brokers reacted to the announcement of the €34 per share offer
so as to express their opinion in a dedicated note. As an example, the reaction of two of them
is provided below:
“We consider Axel Springer’s €34 per share offer to be on the low side. We think
minority shareholders will rebuff the offer for the most part given: 1) the quality of
SeLoger.com’s business model and the fact that it is one of the most profitable internet
company in France; 2) the company’s growth potential with the real estate agency
penetration rate of just 61% expected to move towards 80-90% going forward, in line
with English and Australian peers; 3) the credibility of the current management team.”
Société Générale, 13 September 2010
“An offer at €34 would fail to reflect SeLoger’s growth prospects. First, the fact that
the two founders have accepted the offer does not mean the deal is fair. Second, we
estimate that our €40 DCF-based target price is conservative: it assumes 80%
penetration rate among real estate agents in 2015 (vs. 61% in 2009) and a 50% market
share of real estate agent budgets (while the press sector and SeLoger’s online peers
gradually vanish). We have a bull case of €49 based on more aggressive assumptions.”
Exane, 10 September 2010
It is worth noting that SeLoger had always maintained close relations with its brokers, enabling
them to refine their business plans more accurately. According to analysts following the stock,
SeLoger’s outlook was very positive. They strongly believed in the company’s significant
growth potential remaining as a standalone entity, the resilience of its business model and the
quality of the new management in place now headed by Roland Tripard who, they believed,
had successfully run the company so far. This might be the reason why they appeared so
confident about the stock being undervalued. All of them confirmed their buy recommendations
and modified their target prices accordingly. Even brokers within large financial institutions,
such as Société Générale, included an acquisition premium of 20% following Axel Springer’s
announcement. In order to explain a higher target price, Chevreux also based its valuation on
trading multiples, stating that SeLoger “should trade at least in line (or with a premium) to
Rightmove” in reference to the “room for market share gains and pricing leverage”.
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As of 14 September 2010, the average target price stood out at €38.7, with prices ranging from
€34 to €44.8 since the offer’s announcement dated 9 September 2010. Refer to Exhibit V for
calculations details.
Trapped by Axel Springer’s method?
As Nomura’s team pointed out to the management, precedent transactions involving Axel
Springer as the acquirer resulted in a creeping takeover. This tactic consists in gradually
acquiring the shares of a target company, via the open market, with a disguised intention of
gaining a controlling stake on the share capital. In order to maintain the stock price low and
buy the stocks cheaply, the acquirer spreads its transactions over a long period of time. Axel
Springer’s past acquisitions of the Norwegian online recruitment website Stepstone and the
French leading women’s portal in Europe auFeminin.com, realised in 2010 and 2007
respectively, are two examples that clearly illustrate its strategy to gain control over its targets.

The supervisory board feared that the terms and conditions of the offer might relate to an
attempt of a creeping takeover. The €34-per-share price offered only represented a 13.3% 4 to
16.3% 5 premium over historical share prices and trading levels pre-offer, depending on
reference points considered. This seemed rather a low level of premium when compared to the
premia usually paid in the context of a French tender offer, which ranged from 22.5%4 to
29.3%5 on average, and all the more insufficient when compared to unsolicited offers, which
stood at 46.3%3 to 49.8%4 on average (see Exhibit VI).
Besides, it is worth mentioning that the reference share prices used in the context of the offer
take into account the SeLoger’s revenues for the second quarter released July 2010 but do not
reflect the impact of the half-year results made public simultaneously to the offer. Yet, the
company published booming results with an 11% increase in sales, net income up 20% and an
EBITDA margin of 52%, and confirmed its forecasts for the year ending December 2010.
Making the offer announcement on the same day deprived the market of reacting to those good
results and therefore artificially increased the premium offered to the reference share prices
considered.
So far, Axel Springer had crossed the 5% and the 10% thresholds and had announced it would
launch a tender offer on the remaining shares. However, with no minimum acceptance threshold
to the offer, what would happen if the latter ended up with less than a majority shareholding?
Was Axel Springer really looking for a controlling stake? If so, why did the company offer such
a low acquisition premium? It would not be in Axel Springer’s interest to make the offer fail.
Report from the independent expert
In a report delivered on 25 October 2010, the independent expert Finexsi, appointed by SeLoger
as per AMF regulation, provided a fair opinion on the terms and conditions of the tender offer.
Its external assessment of the case led him to the following conclusions:
“The application of both intrinsic and comparable valuation approaches point to a
4 Premium over the share price at closing

5 Premium over 1 month volume weighted average share price
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price range for the company of €37.1 (trading multiples of comparable companies) to
€40.0 (DCF central scenario).
These analyses are based, in particular, upon SeLoger.com’s management business
plan, which reflects their view of the growth prospects of the media (online classified
ads) activity (increase in penetration rate, ability to grow ARPU), of growth catalysts
identified by the company (new homes developers, commercial real estate, web
agency) and ultimately of SeLoger.com’s current and indisputable leading position on
its market.”
The share valuation presented in the report did not appear as a big surprise for Nomura’s team
who had performed a similar analysis of the stock value, leading them to the conclusion that
the shares were clearly undervalued. Key assumptions on DCFs have been developed in
Exhibit VII, which also highlights the slight differences in data retained by Finexsi versus
Nomura. Exhibit VIII presents the trading multiples valuation approach performed by both of
them.

Except for Messrs. Amal Amar and Fabrice Robert, all the members of the supervisory board
declared their intention to not tender to the offer in the Reply document dated 26 October 2010.
The supervisory board based its view on the conclusions of the independent expert’s report
disclosed in the company’s reply document in order to reaffirm that the offer price does not
reflect the intrinsic value of the company nor its growth potential. The reply document also
specifies Nomura’s view on the valuation.
French stock market regulator’s approval
On 30 November 2010, the stock market regulator AMF gave its approval to Axel
Springer to launch its €34 a share bid for SeLoger, the public tender offer was declared opened
on Thursday 2 December. Was the game over for the French online real estate advertiser? The
market watchdog’s decision to let the public offer go would, for sure, make the market and the
press less confident about SeLoger’s stock value.
Yet, SeLoger immediately reacted to the event, stating that it would file a lawsuit against the
AMF visa in order to denounce the absence of a minimum threshold to the offer. Shortly after,
SeLoger appealed against the AMF’s conformity decision to launch Axel Springer’s offer at
€34 for a share on SeLoger. As stipulated in its contest, the company’s wish is to cancel the bid
from happening and it has asked the AMF to extend the period of the public purchase offer set
to close on 5 January 2011.
Roland Tripard and his team, well determined to keep their independence as the French leader
on the online property advisements market and willing to make it known, confirmed its
development strategy and announced the company’s growth targets for 2014 in a press release
dated 16 December 2010. As it had just exceeded the symbolic threshold of its 20,000th real
estate outlet, the French property website took advantage of the event to tackle a few points,
from the confirmation of 2010 objectives, with net earnings expected to double by 2014 and
the acceleration of its external growth strategy, to the active management of its cash position
and dividend. The press release has been made available on Exhibit IX. Roland Tripard’s
confidence is conveyed through its feelings about the company’s potential and is expressed at
the end of the press release:
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“We are more confident than ever in our Group's potential for the years to come. The
success of our strategy will enable the Group to double net income within four years,
which will in turn put us in a position to be able to accelerate our acquisitions strategy.
Thanks to the quality of its employees, SeLoger.com has both the financial and human
resources to continue to grow in a buoyant market, whilst responding to customer
needs and offering Internet users all the services they require to succeed in their real
estate projects”
Truth is, SeLoger’s top management was not against being acquired, even by Axel Springer
might it be the only strategic acquirer interested. They had lost their founders as historical
shareholders so they wanted to keep cohesion between their majority shareholders and make
sure they would be on their side to support their future projects. In this context, approaching
the company with a hostile offer was possibly not Axel Springer’s best idea. And, besides, what
kind of upsides could Axel Springer possibly offer? SeLoger was perfectly able to continue its
development on a stand-alone basis as it has already been doing so far.

On 17 December, the offer, which was scheduled to close on 5 January 2010, was extended by
the AMF until further notice so as to give time for the court of appeal of Paris to rule the case.
“The extension of the offer enables shareholders to wait for the Paris court of appeal’s decision
before deciding on the offer”, a spokesman for SeLoger.com told the press.
The graph below summarises the timing of the various announcements and offers related to the
pre-offer period along with the corresponding share price performance.
Exit options for SeLoger
In the meantime and since the bid announcement on 9 September, SeLoger’s management,
jointly with its advisors Nomura and Brandford-Griffith, was working to set up a defense
strategy to prevent the success of the tender offer. Since then, SeLoger had voluntarily remained
very silent about its options and opportunities to avoid the disclosure of any false alarm. In its
efforts not to unveil its options too soon, Roland Tripard made it clear to the press that he would
not accept any physical interview. That would obviously not stop newspapers from whispering
a few possible alternatives. Some were betting on a white knight to do its coming out with a
friendly counterbid. Others were referring to the possibility of issuing poison pills that would
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massively dilute the attacker and oblige any candidate to reach an agreement with the company
beforehand. Axel Springer revising its €34 per share offer to gain shareholders’ adhesion was
another solution considered.
On the bid-opening day, SeLoger’s management announced that its supervisory board would
meet a few days later to discuss various options, which could in particular require the convening
of an Extraordinary General Meeting of its shareholders in order to approve the terms and
conditions of the voted measures.
From mid-December, the press, which started getting impatient about the outcomes of the
defence, made allusions that it might be too late for the French property classified ads website
to find a white knight. This is the exact moment when SeLoger published the press release
unveiling optimistic news about its future growth prospects on 16 December 2010.
A leak reached the ears of Reuters and revealed that the company was planning to invite its
shareholders to vote on capping their voting rights, a defence measure that would efficiently

prevent the German media group from any attempt of a creeping takeover. Then, a few weeks
later on 5 January, the French property website announced it plans to ask shareholders to limit
voting rights to 15% for anyone owning up to 50% of the company. For that matter, the
supervisory board settled an extraordinary meeting scheduled for 20 January 2011.
From then on, all knew that an outcome was close. Would the French online property group
finally come over the hostile takeover bid from Axel Springer? A few days before the meeting,
the American mutual fund Fidelity, holding a 8.68% stake in SeLoger.com, made it public that
it would vote in favour of the proposal. One can reasonably think that Groupe Arnault, with
9.06% of the share capital, would do the same, which together accounted for 17.74% of the
votes. But Axel Springer, with its 12.36% share ownership, would mathematically cause the
operation to fail if it could gather 22% of the votes. Fidelity’s vote may also have a ripple effect
on other managers’ choice. Yet, no option was predictable. Suspense was at a maximum.
Exhibit I: SeLoger.com’s consolidated financial statements
Note: average cost of debt is 5.6% according to SeLoger 2009 annual report
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Exhibit II: Share price of SeLoger
Exhibit III

Recent transactions of comparable companies
Analysis of comparable transactions' multiples
Sales EBITDA EBITDA
Date Acquiror Target Country
(year N) (year N) multiple N+1

29 Sep. 2010 Le Figaro Adenclassifieds France 61.00 9.00 15.8x

22 Sep. 2010 Schibsted Le Bon Coin France 36.54 21.56 18.0x
17 Sep. 2007 Deutsche Telekom Immobilien Scout Germany c. 53.00 20.57 17.4x
Mean 17.1x
Source: Factset, companies
Recent transactions of less comparable companies, but providing information on UV

shorthand (unique visitors)
Analysis of transactions' multiples for Internet publishing companies
Date Acquiror Target Country EV Sales EBITDA UV EV/sales EV/Ebitda EV/UV EV/UV adj
1 Sep. 2010 Group CCM Benchmark (Internet news) France 55 17.0 4.0 18.7 3.2x 13.8x 2.9x 2.1x
1 Feb. 2009 Populis LeGuide (shopping directories) France 51 18.2 4.4 10.0 2.8x 11.6x 5.1x 1.8x
1 Jun. 2008 LeGuide Dooyoo (consumer information) Germany 10 3.4 0.9 3.8 2.9x 11.1x 2.6x 1.8x
Mean 3.0x 10.8x 3.0x 12.2x 3.6x 1.9x
Source: CapitalIQ, MergerMarket, Vulcain

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Exhibit IV: Premia offered by Axel Springer for its €34 per share takeover bid
Analysis of the premium / (discount) of the offer price over historical share price
At 9 September 2010 At 27 September 2010
Share price Premium / Share price Premium /
Share price (€) (discount) (€) (discount)
Closing 30.0 13.3% 37.5 (9.4%)
5-days volume weighted average 29.6 15.1% 37.6 (9.6%)
1-month volume weighted average 29.2 16.3% 37.5 (9.3%)
3-month volume weighted average 29.2 16.3% 35.5 (4.3%)
6-month volume weighted average 29.2 16.4% 33.2 2.6%
12-month volume weighted average 27.2 25.0% 30.1 13.1%
Higher (12 months) 31.6 7.6% 38.0 (10.5%)
Lower (12 months) 22.5 51.0% 22.5 51.0%
Source: Factset
Exhibit V: Brokers prices & recommendations
Brokers' target prices and recommendations
Recorded target prices since H1 results' announcement(1)
Analysts Date Recommendation
Reported target price Target price "standalone"(2)
Goldman Sachs 14 Oct. 2010 Buy €44.8 €44.8

Société Générale 1 Oct. 2010 Buy €42.0 €35.0

Cheuvreux 1 Oct. 2010 Buy €36.0 €36.0
UBS 28 Sep. 2010 Buy €40.0 €38.5
Gilbert Dupont 27 Sep. 2010 Buy €39.8 €39.8
BoA - ML 20 Sep. 2010 - - -
HSBC 17 Sep. 2010 Neutral €40.0 €40.0
Exane 16 Sep. 2010 Neutral €40.0 €40.0
Arkeon 16 Sep. 2010 Sell €34.0 €34.0
ID Midcaps 10 Sep. 2010 Buy €40.0 €40.0
Mean €39.6 €38.7
Median €40.0 €39.8
Min €34.0 €34.0
Max €44.8 €44.8
(1) H1 results' anouncement dated 9 September 2010

(2) "Standalone" = without control premium as in the context of Axel Springer's offer, some equity analysts included a
control premium to their intrinsic value:
- SG included a 20% premium following Axel Springer's announcement
- UBS's target price represents an weighted average between an intrinsic value at €38,50 (weigthed to 80%) and a €46
share value in the event of an offer (weighted to 20%)
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Exhibit VI: Premia usually offered in the context of public tender offers in France
(1)
Analysis of recorded premia offered in the context of public tender offers in France since 1998
Premia offered over volume weighted average share price
1 day 1 month 3 months 6 month 12 months
Sample's mean 22.5% 29.3% 33.2% 32.7% 32.1%
SeLoger's share price (in €/share) 30.00 29.24 29.23 29.21 27.20
Implied price per SeLoger's share 36.76 37.81 38.94 38.77 35.94
Premium / (Discount) on the €34/share offer (7.5%) (10.1%) (12.7%) (12.3%) (5.4%)
Analysis of recorded premia offered in the context of unsolicited public tender offers in France since 1998
Premia offered over volume weighted average share price
Date Acquiror Target Offer type
1 day 1 month 3 months 6 month 12 months
16 Dec. 2009 Siegco Valtech Cash offer 25.7% 27.2% 43.1% 55.0% 69.7%
29 Aug. 2008 Lamgold Euro Ressources Cash offer 30.4% 27.0% 23.3% 21.1% 19.5%
31 May. 2006 Mittal Arcelor Mixed offer 85.4% 79.0% 81.2% 91.1% 104.9%
7 May. 2004 Sanofi-Synthelabo Aventis Mixed offer 30.1% 31.4% 35.6% 36.2% 37.7%
2 Oct. 2003 Alcan Inc. Pechiney Mixed offer 51.6% 63.9% 81.1% 83.9% 57.7%
4 Apr. 2002 SAICA et Mondi La Rochette Cash offer 91.3% 96.8% 97.9% 75.8% 73.0%
8 Feb. 2002 Partouche Europeenne de Casinos Cash offer 49.4% 64.0% 73.8% 60.2% 48.6%
20 Jul. 1999 Total Fina Elf Share offer 28.2% 30.4% 29.0% 32.4% 34.6%

8 Jul. 1999 BNP Paribas Share offer 39.4% 41.5% 40.4% 43.3% 33.8%
24 Mar. 1999 Fimalac Strafor Facom Cash offer 31.8% 36.7% 33.9% 44.8% 23.8%
Mean 46.3% 49.8% 53.9% 54.4% 50.3%
SeLoger's share price (in €/share) 30.00 29.24 29.23 29.21 27.20
Implied price per SeLoger's share 43.90 43.80 44.99 45.09 40.89
Premium / (Discount) on the €34/share offer (22.5%) (22.4%) (24.4%) (24.6%) (16.8%)
(1) Sample gathering all OPA of comparabe size (€200m-€1bn) realised under the French usual procedure (all sectors) since 1998, including the
following transactions (acquiror / target): Citloi / Ilog (26 August 2008), Axel Springer / auFeminin (27 July 2007), Vinci / Entrepose
Contracting (21 June 2007), Credit Foncier / Locindus (21 December 2006), Bridgepoint Capital / Alain Afflelou (14 March 2006), Apax
Altamir et MMG / Sechilienne-Sidec (30 August 2005), Groupe Suren / Medidep (16 August 2005), Quicksilver / Rossignol (23 May 2005),
Axa Private Equity / Camaïeu (1er February 2005), Hutchinson Whampoa / Marionnaud (14 January 2005), Credit Industriel et Commercial /
IPO (26 March 2004), Multibrands SAS / GrandVision (27 July 2003), SAICA et Mondi / La Rochette (9 April 2002), Partouche / Européenne
de Casinos (26 February 2002), ABB / Entrelec Group (19 April 2001), Financière Alexandre III / Fives-Lille (4 December 2000), Credit
Agricole Indosuez / CPR (21 September 2000), 9 Telecom Réseau / Jet Multimedia (18 September 2000), Société Industrielle du Hanau / De
Dietrich (3 July 2000), Société Générale d’Entreprises / Sogeparc (19 July 1999), More Group Europe / Dauphin OTA (11 June 1999),
Lagardère SCA / Europe 1 (12 April 1999), Fimalac / Strafor Facom (24 March 1999), Continentale d’Entreprises / Nord-Est (12 November
Source: Offer documents available on the AMF website
117-0004-1
Exhibit VII: Assumptions on DCF as presented in the draft reply document
Management’s business plan covers the period 2010-2016 but was not disclosed in the
document 6. Nevertheless, according to his estimates, SeLoger should maintain annual sales
growth of above 10%. The business plan is globally in line with brokers’ estimates over the
2012 to 2014 period, which itself display an annual growth of 14% in Sales and 17% in
EBITDA, representing costs optimisation.
Based on the management’s business plan, the financial advisor and the independent expert
provided details on their interpretation of the business plan for valuation purposes.
Assumptions
Nomura Finexsi
taken by / on
• Risk-free rate at 2.6% (1 month average of 10 year • Risk-free rate at 2.7% (average of the 10-year-OAT in
OAT as of 9 September 2010) September)
• Market risk premium of 6.3% (average risk • Equity market risk premium at 7.26%
WACC premiums released by Journal des Finances, • Unlevered beta at 0.95 based on a sample of comparable
Associés en Finance and Factset) companies
• Unlevered beta of 1.1 (source: Barra August 2010) • As of September 2010, the company has been presented
• Gearing (financial debt / equity) of 10% by Finexsi as being in a positive net cash situation
• Capex level maintained at 1.7% of sales • The amount of annual depreciation converge toward the
• D&As equals to investment expenses amount of investments (€2m per year)
• Working capital equally balanced between payable • To determine the change in working capital, they relied
and receivables on the hypothesis of a 36 days sales of rotation (i.e. 10%
• Growth rate to infinity of 2.5% (for guidance, the of sales)
Cash flows
draft offer document related to Adenclassifieds • The corporate tax rate used is 34%
and terminal
offer indicates a 2.5% growth rate to infinity) In its model, Finexsi has chosen to extrapolate the
value
• EBITDA margin’s target of 56% at explicit management’s business plan to 2020 and relied on the
horizon following assumptions on terminal value to perform the
valuation:
• EBITDA margin at horizon period of 55.7%
• 2% of terminal growth in sales
From the total enterprise value to the share value of As of 30 September 2010, the net financial position derives
the company, the bridge contain the following from the following debt situation:
EV to share
elements: • Short term and long term financial debt of €32.0m
value bridge
• The group’s consolidated net financial debt, which • Cash & cash equivalents of €32.7m
amounts to €3.8m as of 30 June 2010 • No minority interests
6 As far as the business plan is concerned and in accordance with the regulation, the company decided to preserve the
confidentiality of certain information.
117-0004-1
• Pension commitments, which amount to €0.1m • Pension commitments of €0.3m

(net of taxes) as of 31 December 2009 • Non-current financial assets of €0.3m
• The impact of the share buy-back program 7
between 30 June 2010 and 30 September 2010, i.e.
valued at €0.9m
• Proceeds from the exercise of employees’ stock
options that will be in-the-money during the offer
period, estimated to be valued at €0.6m
Total number of diluted shares considered in the Fully-diluted number of shares results from:
analyses includes: • The number of shares as of 30 September 2010
• Total the number shares (16,646,503 shares) that (16,646,503 shares), adjusted by:
forms the share capital, adjusted by: • The number of potential shares resulting from the
Fully diluted • The company’s treasury shares of (5,453 shares), exercise of stock options: 221,000
number of and • The number of potential shares resulting from free share

shares • Employees’ stock options: 10,000 attributed in attribution: 188,300
2008, which exercise period started on 18 • The number of the treasury shares cancelled: 9,780
December 2009, and 48,100 attributed in 2009, • The number of the treasury shares cancelled (share buy-
which exercise period will be opened on 18 back programme): 136,299
December 2010
Exhibit VIII: Peers’ multiples analysis
Analysis of peers' trading multiples - Nomura analysis

(data as of 9 september 2010, in €m, except for share price data) EBITDA multiples EBIT multiples
Share Equity Net Enterprise
Company Country price value Debt value 2010E 2011E 2012E 2010E 2011E 2012E
Rightmove UK 7.08 1,014 (25) 989 15.1x 12.9x 11.4x 15.6x 13.5x 12.4x
REA Group Australia 11.82 1,106 (62) 1,044 16.3x 13.3x 11.4x 17.9x 14.6x 12.5x
Mean 15.7x 13.1x 11.4x 16.8x 14.1x 12.5x
7 This method consists in using the cash coming from the exercise of the employee stock options to buy back existing shares
on the market. Then, these new treasury shares are cancelled to compensate for part of the new shares created during the
exercise of options.
117-0004-1
Analysis of peers' trading multiples - Finexi analysis

1. "Restricted" sample
(data as of 9 september 2010) EV / EBITDA

Company 2010E 2011E 2012E
Rightmove 14.3x 12.3x 11.2x
REA Group 15.3x 12.3x 10.6x
Mean 14.8x 12.3x 10.9x
2. Expanded sample
(data as of 9 september 2010) EV / EBITDA

Company 2010E 2011E 2012E
Rightmove 14.3x 12.3x 11.2x
REA Group 15.3x 12.3x 10.6x
Carsales.com 16.4x 13.1x 11.3x
Dice 9.1x 7.2x 6.2x
Seek 19.0x 14.5x 12.6x

Mean 14.8x 11.9x 10.4x
Note: the "expanded" sample refers to the companies not directly linked to SeLoger's business but validating the following criterion:
- online classified adverstising business
- similar business model: revenues mainly resulting from a professional clientele (B-to-B business) that pay for putting the advertissements
online
- comparable level of profitability and growth in EBITDA margin
117-0004-1
Exhibit IX: SeLoger’s press release dated 16 December 2010
SeLoger.com confirms its development strategy and announces its growth targets for 2014
• Confirmation of objectives for 2010

• Strong organic growth and net profit expected to double in four years8
• Acceleration of external growth strategy
• Active management of cash position and dividends
Paris, 16 December 2010 – In a context of sharp recovery of the real estate market,
SeLoger.com confirms its development strategy and announces its growth targets for 2014.

The Company’s growth pattern remains strong as the Group has just exceeded the symbolic
threshold of its 20,000th real estate outlet.
Confirmation of objectives for 2010, net earnings expected to double by 2014

SeLoger.com confirms that its 2010 results will evidence a strong growth compared to 2009.
Revenues, supported by the growth of both market penetration and ARPU, should reach a
level close to the middle of the initial estimate, i.e. between €81 million and €84 million.
Current EBITDA 8 should be in the upper end of the estimated guidance, i.e. between €42
million and €44 million, which represents an increase of nearly 18% compared to 2009.
Based on the proven success of its growth strategy, the Group expects its net income to
double within 4 years, corresponding to an average annual growth of around 20%. This
increase will mainly be fuelled by the continued growth in market penetration, the rise in
ARPU (additional services, offer segmentation, subscriptions to specialised portals) and the
development of a complete range of communication services (web agency, the Périclès
transaction software).
Acceleration of external growth strategy

In addition to organic growth, SeLoger.com intends to accelerate growth through targeted
acquisitions.
In France, the Group wants to pursue the same strategy that it has been implementing for
several years, which has allowed to secure leading market positions and to enter specialised
market niches. Since its acquisition in 2006, Périclés has reported a doubling of its revenues,
while Belles Demeures and AgoraBiz, which were purchased in 2008, have both become
market leaders, respectively in the high-end and commercial property segments. By pursuing
this acquisition strategy in France, SeLoger.com will be able to further enhance its offering of
services for real estate professionals.
Internationally, SeLoger.com is targeting countries where the online property market is not
yet consolidated but where real estate agents are already beginning to focus on their online
presence. SeLoger.com wishes to apply the know-how it has gained in France in order to help
young companies reach more quickly leading market positions in their respective countries of
operations.
8 On the basis of the management business plan used by the independent expert Finexsi for the purpose of its valuation report
9 EBITDA : Earnings before interest, tax, depreciation and amortization, post IFRS 2
117-0004-1
In order to implement this external growth strategy and to benefit from the currently attractive
financing conditions, SeLoger.com intends to approach one or several banks to secure a credit
line of up to €100 million.
Active management of cash position and dividends

SeLoger.com benefits from a solid financial structure, and, thanks to a significant generation
of cash flows, will report a positive net cash position of around €10 million at the end of the
current financial year. As a consequence, the Group is now able to manage its balance sheet
and cash position more actively.
In this perspective, at the Annual General Meeting of shareholders to be convened in order to
approve the financial statements of the current financial year, the Supervisory Board will
propose that the dividend to be paid out of 2010 earnings be [at least] doubled as compared to
the amount paid last year.
In future financial years, the Group intends to maintain a minimum distribution level of 30%
of net earnings whilst continuing to distribute to shareholders part of the cash that would not
have been used to finance potential acquisitions.

By implementing this proactive strategy, combined with a potential credit facility,
SeLoger.com believes it has the financial resources to implement an ambitious external
growth programme (and in particular to rapidly seize acquisition opportunities) whilst
offering an attractive yield to its shareholders.
“We are more confident than ever in our Group's potential for the years to come. The success
of our strategy will enable the Group to double net income within four years, which will in
turn put us in a position to be able to accelerate our acquisitions strategy. Thanks to the
quality of its employees, SeLoger.com has both the financial and human resources to continue
to grow in a buoyant market, whilst responding to customer needs and offering Internet users
all the services they require to succeed in their real estate projects”, commented Roland
Tripard, Chairman of the Management Board.
Exhibit X: SeLoger’s business performance

117-0004-1

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Taught by Marc Kitten, from 10-May-2024 to 31-Jul-2024. Order ref F508245.

SeLoger’s activities were split into 3 main businesses:

Taught by Marc Kitten, from 10-May-2024 to 31-Jul-2024. Order ref F508245.

Internet platforms, used to manage the transactions of estate agents

The industry and the Group’s competitive edge

Taught by Marc Kitten, from 10-May-2024 to 31-Jul-2024. Order ref F508245.

Taught by Marc Kitten, from 10-May-2024 to 31-Jul-2024. Order ref F508245.

Taught by Marc Kitten, from 10-May-2024 to 31-Jul-2024. Order ref F508245.

Trapped by Axel Springer’s method?

Taught by Marc Kitten, from 10-May-2024 to 31-Jul-2024. Order ref F508245.

stood at 46.3%3 to 49.8%4 on average (see Exhibit VI).

Report from the independent expert

4 Premium over the share price at closing

Taught by Marc Kitten, from 10-May-2024 to 31-Jul-2024. Order ref F508245.

specifies Nomura’s view on the valuation.

French stock market regulator’s approval

Taught by Marc Kitten, from 10-May-2024 to 31-Jul-2024. Order ref F508245.

Exit options for SeLoger

Taught by Marc Kitten, from 10-May-2024 to 31-Jul-2024. Order ref F508245.

Exhibit I: SeLoger.com’s consolidated financial statements

Exhibit II: Share price of SeLoger

Taught by Marc Kitten, from 10-May-2024 to 31-Jul-2024. Order ref F508245.

(year N) (year N) multiple N+1

29 Sep. 2010 Le Figaro Adenclassifieds France 61.00 9.00 15.8x

Source: Factset, companies

Recent transactions of less comparable companies, but providing information on UV

Mean 3.0x 10.8x 3.0x 12.2x 3.6x 1.9x

Source: CapitalIQ, MergerMarket, Vulcain

Goldman Sachs 14 Oct. 2010 Buy €44.8 €44.8

Société Générale 1 Oct. 2010 Buy €42.0 €35.0

(1) H1 results' anouncement dated 9 September 2010

Taught by Marc Kitten, from 10-May-2024 to 31-Jul-2024. Order ref F508245.

Exhibit VII: Assumptions on DCF as presented in the draft reply document

• Pension commitments, which amount to €0.1m • Pension commitments of €0.3m

Taught by Marc Kitten, from 10-May-2024 to 31-Jul-2024. Order ref F508245.

Exhibit VIII: Peers’ multiples analysis

Analysis of peers' trading multiples - Nomura analysis

Analysis of peers' trading multiples - Finexi analysis

(data as of 9 september 2010) EV / EBITDA

(data as of 9 september 2010) EV / EBITDA

Taught by Marc Kitten, from 10-May-2024 to 31-Jul-2024. Order ref F508245.

Exhibit IX: SeLoger’s press release dated 16 December 2010

• Confirmation of objectives for 2010

Taught by Marc Kitten, from 10-May-2024 to 31-Jul-2024. Order ref F508245.

Confirmation of objectives for 2010, net earnings expected to double by 2014

Acceleration of external growth strategy

Active management of cash position and dividends

Taught by Marc Kitten, from 10-May-2024 to 31-Jul-2024. Order ref F508245.

Exhibit X: SeLoger’s business performance

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