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UPDATE 3-Digital music firm Believe lowers sights for IPO to 300 mln euros

* Target is 200 mln euros lower than expected

* Price range for IPO set at 19.5-22.5 euros per share

* Final pricing set on June 9 (Recasts story, adds details, CEO quote)

PARIS, June 1 (Reuters) - French digital music company Believe announced on Tuesday that it had reduced its initial public offering target to 300 million euros($367 million), 40% less than it had said last month when it first disclosed its plans for a share listing in Paris.

Chief Executive Officer Denis Ladegaillerie told reporters that the more modest target did not reflect any lack of investor appetite. He said the decision was taken because existing shareholders did not want to dilute their stake further in a company that aims to challenge leading world music labels.

“We reduce the dilution for them, and it is much more effective in creating value for the shareholders who enter today,” Ladegaillerie said.

Believe plans to sell a maximum of 15.4 million shares via the listing (IPO), within a price range of 19.50 to 22.50 euros per share, thus giving the company a market value between 1.9 and 2.1 billion euros.

The company said it expected the final pricing to take place on June 9, with trading in shares due to start from June 10. About 15%-18% of the group will be floated, depending on the price range at which shares are sold.

Believe is behind best-selling artists in France like rapper Jul and has been acquiring labels like German hip hop specialist Groove Attack. The company operates partly by targeting lesser-known singers outside the ranks of top global stars.

The group helps to distribute music by striking deals with listening platforms such as Spotify, Apple Music and Amazon, and is looking to expand its reach globally and also in new areas such as classical music.

It has made 18 acquisitions in the past six years. It confirmed it was targeting revenue growth at constant exchange rates of around 20% this year, after 2020 sales of 441 million euros.

It targets to grow its adjusted earnings before interest tax depreciation and amortisation (EBITDA) margin to 5-7% by 2025 from 1.8% last year.

$1 = 0.8179 euros Reporting by Mathieu Rosemain and Matthieu Protard; Editing by Jan Harvey & Simon Cameron-Moore

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