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Mediaset furious as Vivendi takes ‘stealth’ stake

Vivendi-HQMediaset has reacted furiously to what it sees as a hostile takeover attempt by stealth after Vivendi acquired a 3.01% stake in the Italian media group.

After acquiring the stake without consulting Mediaset, Vivendi said it intended to continue to acquire the Italian group’s shares “until possibly becoming Mediaset’s second largest industrial shareholder, which, to begin with, could represent between 10% and 20% of the Mediaset share capital”.

Fininvest, the holding company controlled by the Berlusconi family, owns about one third of Mediaset’s stock.

The French media group said that in line with regulatory requirements it had informed the Italian securities regulator Consob and Mediaset itself that the 3% threshold of ownership had been crossed.

Under the terms of the aborted April 8 deal between the pair, Vivendi and Mediaset had been set to exchange 3.5% stakes in each other’s companies, while Vivendi was to take 100% control of the Italian group’s pay TV unit Mediaset Premium.

Vivendi subsequently said it would not go ahead with the original deal after commissioning a report on Mediaset Premium’s finances and claiming that the pay TV unit’s prospects were worse than it had originally been led to believe.

Mediaset has contested Vivendi’s claim vigorously and initiated legal action, using the French company for damages inflicted on it in the absence of the proposed deal.

As part of its legal assault, Mediaset had originally called for the seizure of Vivendi shares in line with the obligation it believed the French company had to transfer a 3.5% stake to it. Mediaset later dropped the bid to have Vivendi’s shares seized after assuring itself that Vivendi would be able to fulfill the commitment to pass a 3.5% stake to Mediaset in the even of the case being settled.

Mediaset said that it had hired Intesa Sanpaolo and Unicredit to help it defend itself againstwhat it views as a hostile takeover bid. The Italian company said it would also assess Vivendi’s “real goals” in aborting the original deal. It referred pointedly to the fact that the value of its stock has fallen by about 30% as a result of the collapse of the April 8 agreement, opening the way for Vivendi to acquire its shares at a knockdown price.

Mediaset said that Vivendi’s purchase of shares confirmed the truth of Mediaset’s allegation in July that the French outfit planned to move from an industrial agreement to a takeover attempt. The Italian company also said that Vivendi’s statement on its acquisition confirmed the validity of the disputed April 8 agreement.

Vivendi said in its communiqué that it believed that “the strategic interest of [the pair’s] industrial partnership announced on April 8, 2016 supersedes the stakes of the lawsuit” and that it had therefore become a Mediaset shareholder in line with its plan to develop its activities in southern Europe and create a larger-scale European media and content group.