Vivendi Universal has decided to take up its option and buy BT’s 26% stake in Cegetel, giving it 70% control of the French telecoms group.
Jean-René Fourtou, Chairman and CEO of Vivendi, said yesterday that the company had sufficient funds to match Vodafone’s E4 billion bid for the shareholding. Under a binding agreement, Vivendi had until next week to pre-empt any offer to buy shares in Cegetel (see
Vivendi Seeks New Funds For Cegetel Bid).
Despite a number of disposals, Vivendi remains heavily in debt and last week announced that revenues for the third quarter had fallen by 2% (see Vivendi Revenues Dip 2%, Disposals Ease Debt). However, Cegetel was too much of a lure to pass up and Fourtou created a special purpose vehicle to raise the necessary finance.
The chairman has also reiterated that Vivendi could spin off its US entertainment assets under the Universal brand, a move which has the backing of the division’s co-head Barry Diller.
“From a strategic point of view, I have adopted the suggestion of Barry Diller to try to create a very strong company in entertainment under the Universal brand which means keeping most of the assets and offering others to come with us to strengthen the whole and probably go partially on the market,” said Fourtou.
