April 8, 2019
Lewis W. Dickey, Jr.
President and Chief Executive Officer
Modern Media Acquisition Corp. S.A.
3414 Peachtree Road, Suite 480
Atlanta, GA 30326
Re: Modern Media Acquisition Corp. S.A.
Amendment No. 1 to Form F-4
Filed March 29, 2019
File No. 333-229613
Dear Mr. Dickey:
We have reviewed your amended registration statement and have the
following
comments. In some of our comments, we may ask you to provide us with
information so we
may better understand your disclosure.
Please respond to this letter by amending your registration statement
and providing the
requested information. If you do not believe our comments apply to your facts
and
circumstances or do not believe an amendment is appropriate, please tell us why
in your
response.
After reviewing any amendment to your registration statement and the
information you
provide in response to these comments, we may have additional comments. Unless
we note
otherwise, our references to prior comments are to comments in our March 11,
2019 letter.
Amendment No. 1 to Form F-4
Proxy Statement/Prospectus Cover Page, page i
1. Disclose that if the cash distribution to Akazoo equityholders is
reduced from $20 million,
then Akazoo equityholders will receive more shares in PubCo in the
business
combination.
2. To provide context to your disclosure regarding the terms of the
business combination and
the impact of redemptions by holders of public shares, please disclose
the total number of
public shares issued, the number redeemed in connection with the
solicitation to extend
the time to consummate a business combination, and the current number of
public shares
outstanding. Similarly, disclose the original amount deposited in the
trust account, the
amount of the trust funds used to redeem shares in connection with the
solicitation to
Lewis W. Dickey, Jr.
Modern Media Acquisition Corp. S.A.
April 8, 2019
Page 2
extend the time to consummate a business combination, and the current
amount of funds
in the trust account.
What consideration will be paid in connection with the Business Combination?,
page 10
3. We note your response to prior comment 26 and the disclosure provided
on page 10 and
elsewhere. Please clarify your disclosure and explain to us how the
cash payment to the
former shareholders of Akazoo prevents the dilution of MMAC
stockholders upon
consummation of the recapitalization transaction.
Questions and Answers About the Business Combination and the Special Meeting
Will I experience dilution as a result of the Business Combination?, page 11
4. We note that a material amount of redemptions are permitted under the
maximum
redemption condition, this maximum redemption amount may be waived by
Akazoo, and
Akazoo equityholders will receive more shares in PubCo if the $20
million cash
distribution is reduced. Therefore, also disclose the percentage of
PubCo common shares
that the MMAC public shareholders, MMAC sponsor and Akazoo
equityholders will own
assuming maximum redemption and the waiver of the maximum redemption
amount.
Provide this disclosure elsewhere as appropriate, including in
connection with the diagram
of the post-business combination structure on page 17.
Selected Historical Financial Data of Akazoo, page 27
5. Please disclose historic net income per share data for each of the
periods presented
pursuant to Item 3.A.2 of Form 20-F.
6. We note in connection with the formation of the LuxCo holding company,
LuxCo shares
will be issued in exchange for Akazoo shares on a 100 for 1 basis.
Please disclose pro
forma per share data for the most recent year and subsequent interim
period to give effect
to this stock split.
Comparative Historical and Unaudited Pro Forma Per Share Data, page 34
7. We note on page 123, for accounting purposes, the Business Combination
will be treated
as the equivalent of Akazoo issuing shares for the net assets of MMAC,
accompanied by a
recapitalization. Please revise the first and third paragraphs on page
34, and elsewhere in
the filing as applicable, to characterize the transaction as
recapitalization of Akazoo and
not a business combination.
8.
FirstName LastNameLewis W. Dickey, Jr. data pursuant to Item 3(f) of Form F-4.
Provide Akazoo equivalent per share
Comapany note your response to Acquisition Corp. S.A.
9. We NameModern Media prior comment 14. Please explain to us how you
calculated the
MMAC pro forma book value per share amounts disclosed in footnote (c) on
page 34.
April 8, 2019 Page 2
FirstName LastName
Lewis W. Dickey, Jr.
FirstName LastNameLewis Corp. S.A. Jr.
Modern Media Acquisition W. Dickey,
Comapany NameModern Media Acquisition Corp. S.A.
April 8, 2019
April 3 2019 Page 3
Page 8,
FirstName LastName
10. We note prior to the effective date of the merger with MMAC, LuxCo
will become a
holding company of Akazoo through a share exchange on a 100 for 1
basis. Please revise
the historic per share data of Akazoo to reflect the effects of this
reorganization, which we
note is effectively a share split.
Certain U.S. Federal Income Tax Consequences of the Business Combination to
U.S. Holders,
page 91
11. We note your response to prior comment 24. Please further clarify your
disclosure
by stating at the beginning of this subsection that the discussion
constitutes the opinion of
named counsel. Then, clarify that the second paragraph of the
subsection discusses why
counsel cannot opine that the merger "will" qualify as a
reorganization within the meaning
of Section 368 of the Code. Consider whether you should discuss the
alternative tax
consequences if the business combination does not qualify as a Section
368
reorganization. Lastly, indicate on pages 12 and 20 that you received
a legal opinion on
the tax consequences and there is uncertainty that the business
combination will be non-
taxable to MMAC securityholders.
Unaudited Pro Forma Condensed Combined Financial Statements
Basis of Pro Forma Presentation, page 123
12. We note Akazoo may waive the condition requiring that MMAC not have
less than $60
million of cash available in the trust account upon consummation of
the business
combination. Please provide an additional pro forma presentation to
give effect to the
possibility of the consummation of the business combination under a
scenario
where redemptions reduce MMAC's net tangible assets to the $5,000,001
minimum.
Please make similar revisions to the Selected Unaudited Pro Forma
Condensed Combined
Financial Information and the Comparative Historical and Unaudited Pro
Forma Per Share
Data.
13. We note as of June 30, 2018 Akazoo is reporting a retained deficit.
Please clarify on page
124 and elsewhere, as applicable, that the payment of the $20 million
cash distribution
would represent a return of share premium, if true, or advise us.
Pro Forma Condensed Combined Statement of Financial Position as of June 30,
2018, page 125
14. We note your response to prior comment 27. However, since this is a
planned distribution
to owners of Akazoo, from the proceeds to be contributed by the
shareholders of MMAC,
we believe you should reflect as a liability in the Akazoo pro forma
balance sheet an
accrual for the $20 million distribution.
Lewis W. Dickey, Jr.
FirstName LastNameLewis Corp. S.A. Jr.
Modern Media Acquisition W. Dickey,
Comapany NameModern Media Acquisition Corp. S.A.
April 8, 2019
April 4 2019 Page 4
Page 8,
FirstName LastName
Pro Forma Condensed Combined Statement of Operations, page 127
15. We note on page ii the disclosed number of shares to be issued by
PubCo does not agree
with the number of shares used to calculate pro forma earnings per
share assuming no
redemption. Please revise your disclosures or explain to us why there
is a difference in
the number of shares.
16. We note in connection with the formation of the LuxCo holding company,
LuxCo shares
will be issued in exchange for Akazoo shares on a 100 for 1 basis.
Please replace the
historic Akazoo per share data and the number of outstanding shares
with pro forma
amounts that give effect to this stock split.
Management's Discussion and Analysis of Financial Condition and Results of
Operations of
Akazoo
Key Performance Indicators, page 142
17. We note your response to prior comment 30. Please disclose whether
management tracks
the number of subscribers who sign up directly with Akazoo as opposed
to through a third
party for each period. To the extent material, please disclose any
changes or trends with
respect to the percentage of subscribers derived from your partners
for the applicable
periods.
18. We note your response to prior comment 35. Based upon your disclosure
on pages 55 and
142, it appears PubCo will review key metrics such as churn and
customer acquisition
costs ("CAC") to evaluate growth trends, measure PubCo's performance,
and make
strategic decisions. We also note that Akazoo's service royalties may
be dependent upon
the rates of subscriber churn. As such, we continue to believe you
should disclose average
monthly churn for each period.
Akazoo Limited Consolidated Financial Statements
Consolidated Statement of Profit or Loss and Other Comprehensive Profit, page
F-3
19. Please disclose historic earnings per share data pursuant to IAS 33.
20. We note in connection with the formation of the LuxCo holding company,
LuxCo shares
will be issued in exchange for Akazoo shares on a 100 for 1 basis.
Please disclose pro
forma earnings per share data for the latest year and subsequent
interim period to give
effect to this share exchange.
Lewis W. Dickey, Jr.
FirstName LastNameLewis Corp. S.A. Jr.
Modern Media Acquisition W. Dickey,
Comapany NameModern Media Acquisition Corp. S.A.
April 8, 2019
Page 8,
April 5 2019 Page 5
FirstName LastName
You may contact Robert Shapiro, Staff Accountant, at (202) 551-3273 or
Robert S.
Littlepage, Accountant Branch Chief, at (202) 551-3361 if you have questions
regarding
comments on the financial statements and related matters. Please contact Joshua
Shainess,
Attorney-Advisor, at (202) 551-7951 or Kathleen Krebs, Special Counsel, at
(202) 551-
3350 with any other questions.
Sincerely,
Division of
Corporation Finance
Office of
Telecommunications