Vivendi Raises Stake In BSkyB To 25%

Vivendi, the French media and utilities group, last night sealed an £825 million deal to increase its stake in satellite broadcaster BSkyB to 24.5%. At the same time the company also raised its stake in French pay-TV company, Canal Plus, to 49%. Vivendi is now actively looking for an international strategic partnership for Canal Plus and BSkyB is a possible target.

The BSkyB shares were bought by Vivendi from Granada and Pearson, both of which had indirect holdings in BSkyB. Granada and Pearson have been seeking to divest of their holdings in BSkyB for a while; Granada sold its 6.5% direct stake in Sky in October last year (see Granada Sells Stake In BSkyB).

Vivendi’s purchase of the Sky shares entitles it to a third seat on the company’s board. It is thought that Vivendi will now seek to resume the merger talks between Canal Plus and BSkyB which were aborted earlier in the year (see Canal Plus And BSkyB Talks Suspended).

However, Rupert Murdoch, chairman of BSkyB, ruled out any possibility that Sky would merge with Canal Plus (see Murdoch Rules Out BSkyB/Canal Plus Merger). If such a merger did take place, Vivendi, with its ownership of Pathé’s 17% stake in Sky (see Sharewatch), would become the majority shareholder in BSkyB effectively making it a French company.

Shares in BSkyB were up 7p at 557˝p by 10:30 this morning.

BSkyB: 0171 705 3000