Vivendi has pulled out of its planned acquisition of an 89% stake in Mediaset Premium and submitted an alternative proposal to take a 20% in the pay TV outfit.
This follows the emergence of what Vivendi described as “significant differences” in its analysis of Mediaset Premium’s results.
Vivendi said that its CEO Arnaud de Puyfontaine wrote to Mediaset’s management on June 21 to inform the Italian broadcaster’s management of its concerns. The media giant said that it submitted its alternative plan to Mediaset yesterday.
Mediaset acknowledged that it had received a communication from Vivendi with the alternative proposal, which it said changed the value of the agreement and of Mediaset’s capital.
Vivendi said it would go ahead with the exchange of 3.5% of its capital with Mediaset, but that it would only purchase 20% of Mediaset Premium instead of the agreed 80%. It said it would purchase a further 15% of the pay TV unit’s capital in three years through a convertible bond issue.
Mediaset made it clear in its statement that Vivendi’s proposal was a surprise and that it was not agreed. It said it was contrary to the commitments made by Vivendi in its April 8 agreement with Mediaset. It said it would pursue its rights by all means available.
The Italian company’s board will meet later this week to discuss its interim results and is expected to address the matter.
Vivendi for its part said that it still had a “desire to build a major strategic alliance with Mediaset and Mediaset Premium”.
A Vivendi spokesman told DTVE that differences had emerged as a result of due diligence performed by Vivendi after its April agreement. She said that Vivendi remained committed to finding an agreement and to its strategy to build media assets in Italy and southern Europe.
Continued losses at Mediaset Premium helped push its parent company into the red in the first quarter, posting a loss of €18 million (US$19.8 million) as against a profit of €600,000 for the same period last year.