Vivendi mulls split with Canal+ and Havas to be listed as separate companies

Source: Vivendi

French media giant Vivendi is considering splitting itself into three separate listed entities, including pay TV operator Canal+, in a move designed to remove a ‘conglomerate discount’ on the valuation of the whole.

Vivendi said that it had suffered from a significant discount on its valuation since the distribution and listing of Universal Music Group (UMG) in 2021, which limited its room for manoeuvre, including its ability to make growth acquisitions on behalf of its subsidiaries.

UMG is far larger than the remaining Vivendi group – it has a valuation of around €47 billion against Vivendi’s €9 billion – and Vivendi has been marked down by investors who have not seen synergies between the group’s various entities.

Vivendi is therefore studying the possibility of listing Canal+ and advertising outfit Havas separately, with a third investment-focused company holding listed and unlisted financial stakes in a number of media and entertainment entities, including Vivendi’s majority stake in publishing outfit Lagardère.

Regarding Canal+, the pay TV operator accounts for the lion’s share of Vivendi’s revenue and profit since the spinning out of UMG. Vivendi said that Canal+ had experienced significant growth in recent years, reaching a subscriber base of over 25 million in nearly 50 countries.

Following the acquisitions of pan-European pay TV operator M7 and international channel provider SPI, Canal+ has also taken strategic stakes in African pay TV giant Multichoice, Asian streamer VIU, and struggling Nordic streamer Viaplay, which Vivendi characterised as highlighting its ability to identify and seize promising opportunities across all its geographical areas.

Vivendi said that Canal+ is well-positioned to capitalize on further consolidation opportunities on a global scale.

The announcement of a potential splitting up of the group follows the completion of Vivendi’s acquisition of a majority stake in Lagardère last month, selling publishing subsidiary Editiis to Czech investor Daniel Kretinsky and magazine Gala to Figaro group to secure approval.

Vivendi’s study of the potential split could last between 12 and 18 months, so an immediate break-up is not on the cards.

Vivendi’s shares nevertheless jumped by about 10% on the news.