Italian regulator to probe Vivendi’s Mediaset move

Italian antitrust watchdog AGCOM has stepped into the battle raging between Vivendi and Mediaset with a notice that it intends to investigate whether Vivendi’s move to acquire over 20% of the Italian broadcaster could be in breach of cross-ownership rules.

According to AGCOM, the French media giant’s move could be in breach of a provision of the Testo Unico dei Servizi di Media Audiovisivi e Radiofonici (TUSMAR) regulation that electronics communications companies with a market share in excess of 40% cannot control more than 10% of a Sistema Integrato delle Comunicazioni (SIC) – meaning a large TV, radio and publishing outfit, such as Mediaset.

The TUSMAR rule is intended to set a ceiling on the extent of concentration of communications and media in the interest of pluralism, competition and the rights of citizens.

The regulator said that Vivendi was the controlling shareholder in Telecom Italia with a stake of 24.68%, and that Telecom Italia had a 44.7% share of the telecom market, while Mediaset, whose controlling shareholder is Fininvest, had a 13.3% of the overall SIC market. According to AGCOM, the numbers mean that an operation to “concentrate control of the two companies” could be prohibited.

Vivendi’s intervention has also sparked animated discussion among Italy’s politicians.

Minister of economic development Carlo Calenda yesterday reportedly described Vivendi’s purchase of Mediaset shares as “an inappropriate hostile takeover”.

Deputies from the opposition 5 Star Movement – itself divided on the issue – who sit on the parliamentary committee on transport and communications, on the other hand, said that any move to “protect Mediaset” would be inappropriate, given that the government had made no move to protect the strategically more-important Telecom Italia from Vivendi’s advances.

Vivendi has acquired a 20% stake in the Italian broadcaster in a series of steps over the last week. The two companies have been engaged in a bitter war of words – and lawsuits – since Vivendi pulled out of a deal signed in April that would have seen it take 100% of Mediaset’s loss-making pay TV unit, Mediaset Premium.