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French media conglomerate Vivendi is considering splitting itself up into three businesses that would all be listed separately, in what would be a major overhaul piloted by owner Vincent Bolloré.
The Paris-based company said it has begun work with bankers and lawyers to evaluate the feasibility of such a plan, which it said was aimed at maximising its valuation.
“Vivendi has endured a significantly high conglomerate discount, substantially reducing its valuation and thereby limiting its ability to carry out external growth transactions for its subsidiaries,” it said.
“In order to fully unleash the development potential of all its activities . . . [the group will] explore the feasibility of a project to split the company into several entities.”
The announcement comes two years after Vivendi spun out Universal Music Group in a blockbuster initial public offering that handed 60 per cent of the share capital to its shareholders. Since the transaction that hived off Vivendi’s most valuable business, the shares of the remaining slimmed-down group have underperformed, prompting the group to consider the break-up scenario.
The surprise announcement comes only weeks after the group finalised a long-awaited takeover of Lagardère. This added book publisher Hachette and a travel retail business focused on transportation hubs to the Vivendi portfolio that also includes French pay-TV operator Canal+.
It is a sign of how Bolloré, a corporate raider and industrialist who first invested in Vivendi in 2011, continues to change the group he effectively still leads even though he is no longer chair. Controlling the group with a stake of just under 30 per cent of shares, he initially sold off video games and telecoms assets, then folded in another company he owned, the advertising agency Havas, in 2018.
He was replaced by his son Yannick Bolloré as chair in 2018, although informally the patriarch still largely sets strategy.
The lack of cohesiveness and synergies between the group’s various operating businesses has long been an issue for investors and a source of frustration for Vivendi. Yannick Bolloré had been trying to improve the situation since his father officially retired in 2022, and told the Financial Times earlier this year that Vivendi was out to prove it was “a coherent company and not a disparate set of holdings”.
If the break-up were to go ahead, the group said, Vivendi’s biggest business, Canal+, which is its main source of revenue and profit, would become a separate company, as would Havas.
Vivendi would then plan to have a third listed branch as an investment company that would house Lagardère and include other listed and unlisted holdings in media and entertainment companies.
It is expected to take some time to study the implications of the break-up, heralding a period of uncertainty. “This project will have to prove its added value for all stakeholders and include an analysis of the tax consequences of the various contemplated operations,” Vivendi added.
Vivendi’s shares are down roughly 15 per cent since UMG was spun out of the company in September 2021, far underperforming an 18 per cent rise for the French blue-chip CAC 40 index.
Shares in Netherlands-listed UMG — in which Vivendi and the Bolloré family still own a combined stake of about 28 per cent — have risen about 9 per cent since its market debut. It is valued at close to €47bn on the stock market, while the slimmed-down version of Vivendi is worth just over €9bn.
