Munich – Freepik Company S.L.U („Freepik“), Malaga, Spain, a portfolio company of EQT Mid Market Europe Fund, has acquired EyeEm Mobile GmbH („EyeEm“), Berlin, Germany. The acquisition took place after the opening of insolvency proceedings over the assets of EyeEm as part of insolvency plan proceedings.
EyeEm was founded in 2011 as a global digital platform for ambitious amateur photographers. The EyeEm platform was originally used to edit images and share them with other users. The originally successful start-up, which at times had more than 20 million registered users, gained media attention when the well-known investor Peter Thiel participated in a financing round in 2015 alongside other well-known investors such as Earlybird. EyeEm was seen as a European alternative to Instagram. From 2015, EyeEm commercialized its images through the central digital distribution of photos for photographers, among other things, who in return received a share of the proceeds. In 2021, Talenthouse AG, based in London, England, and Baar, Switzerland, acquired the EyeEm Group. In April 2023, an application was made to open insolvency proceedings for the assets of EyeEm. Insolvency proceedings were subsequently opened.
The acquisition of EyeEm is taking place as part of insolvency plan proceedings. The transaction will technically be implemented by way of a capital cut. The creditors‘ meeting has already approved the insolvency plan. The parties involved have agreed not to disclose the economic terms of the transaction.
The Wallberg team, consisting of the founders Manuel Brühl, Dr. Arno Malcher and Dr. Simon Sabel as well as Of Counsel Prof. Dr. Caspar Behme provided Freepik with comprehensive legal and tax advice on the project. Dr. Jan Beckmann, Hamburger Anwaltskontor, provided employment law expertise. The Wallberg team worked on the transaction hand in hand with the Spanish law firm FILS Abogados, S.L.P., („Fils“), a Spanish boutique law firm with a special focus on M&A, venture capital and private equity.
In particular, Wallberg & Cie.’s distinctive interface expertise in the areas of tax, IT law (AI) and transactions was fully utilized in advising Freepik. In addition to tax structuring and corporate and insolvency law structuring, issues relating to the legal situation of the technical platform and the AI developed by EyeEm were of central importance.
„This transaction also showed the trend we have observed recently that a key asset and integral part of the investment case is often an AI developed by the target itself. Due to the novelty of the technology, it is not possible to fall back on a broad body of case law with regard to the resulting questions concerning the legal situation of (training) data, the AI itself and the admissibility of alternative use cases of the AI. This is what makes these cases so interesting,“ says AI expert Dr. Malcher. „From a tax perspective, such distressed constellations always raise the question of the appropriate treatment of restructuring gains; this is particularly important in the case of a share deal from insolvency,“ adds tax expert Brühl. „This transaction is a good example of how the market is currently functioning: once celebrated start-ups are unexpectedly in trouble, despite very solid business cases – we see good times for investors with a clear strategic compass and solid funding. We are delighted that we were able to work alongside Freepik and EQT on this complex distressed cross border transaction,“ said transaction expert Dr. Sabel.
The acquirer Freepik was founded in Málaga in 2010 with the idea of making graphic resources available to designers all over the world. The main business purpose is therefore not the licensing of photographs, but of self-created graphics, illustrations and other graphic content. Freepik is a portfolio company of EQT Mid Market Europe Fund, a fund of the Swedish private equity investor EQT with more than EUR 113 billion assets under management. Freepik acquires EyeEm as part of a buy-and-build add-on strategy.
Wallberg Law Tax Advisory GmbH & Cie. KG
StB Manuel Brühl, Tax law
Dr. Arno Malcher, IT-Law, Data protection law, Commercial law
Dr. Simon Sabel, Transactions, Corporate law, lead
Prof. Dr. Caspar Behme, Insolvency law, Financial market supervisory law
Dr. Jan Beckmann, Labor law
Fils Abogados, S.L.P.
Alejandro de Müller, Transactions, Corporate law
Maria Rodrigo Muro, Transactions, Corporate law
Wallberg & Cie.
Wallberg Law Tax Advisory GmbH & Cie. KG is a specialized legal and tax consultancy based in Munich. The founders combine their enthusiasm for legal and tax advice with a strong technological and digital DNA. Wallberg & Cie. focuses on corporate law, tax law and the law of the digital world with a focus on digitalization, transactions and international aspects. Wallberg & Cie.’s expertise is regularly in demand for complex projects, especially in the area of technology investments.