Berlusconi’s Assets in Flux as Son Becomes Mediaset CEO
It’s the end of an era as the media tycoon continues to shy away from the spotlight, and the conglomerate he built may look for deals.
Pier Silvio Berlusconi, son of the former Italian prime minister, has taken over the role of CEO at media conglomerate Mediaset, in which his father's Fininvest is the largest shareholder. He replaces Giuliano Adreani, who held the position for the last 15 years.
As Berlusconi senior looks at a number of potential changes to his holdings, the move is expected to place Mediaset in a position for possible deals.
Pier Silvio Berlusconi has been essential to Mediaset’s recent cost-cutting maneuvers, as well as launching Mediaset’s new pay TV company. Its premium offering has not yet proven profitable after it outbid pan-European pay TV giant Sky, in which Rupert Murdoch's 21st Centruy Fox owns a 39 percent stake, with a $778 million (700 million euros) deal for the rights to the UEFA Champions League for 2015-2018.
Rumors are circling in Italy about a potential sale of Mediaset, which has a market value of $6.06 billion (5.45 billion euros). French media has reported that Vivendi is "actively looking" at acquiring Mediaset assets.
Pier Silvio Berlusconi told reporters that Vivendi would be a "good potential partner" for premium content, but there are no plans to sell the business. Vivendi could still take a stake in Mediaset or its pay TV unit Premium. A Vivendi-Mediaset deal or alliance would be a major move toward rivaling Mediaset's main competitor, pan-European pay TV giant Sky. But Sky is also reportedly exploring a partnership deal.
"We continue to think it would make little sense for Vivendi to acquire Mediaset for several reasons," Sanford C. Bernstein analyst Claudio Aspesi said in a recent report, citing "little tangible synergies outside the small pay TV business." He added: "We would understand the logic of inserting Vivendi in the turnaround of Premium, the pay TV business of Mediaset. Vivendi would have, in fact, content to distribute, pay TV know-how to deploy and the opportunity to monetize a revamped Premium in a possible merger with Telecom Italia."
Berlusconi senior has ducked out of the public spotlight since being convicted for tax fraud in 2013. His center-right party Forza Italia has suffered under Prime Minister Matteo Renzi as Italians seek a change in country politics under the young leader. His son, meanwhile, has taken on more responsibility at Mediaset, saying he recently met Murdoch for a "normal business meeting."
Berlusconi senior is reportedly seeking to offload several assets, including his stake in soccer club AC Milan to a Thai investment group led by Bee Taechaubol, who was offering $560 million for a 51 percent stake. AC Milan, seven-time European champion, has also gone downhill in recent years, and the club is racked with debt. Berlusconi's financial holding company Fininvest recently released a statement that he will maintain control of the soccer club, but could sell a minority stake.
Whether Berlusconi’s assets dissipate, some say his continuing withdrawal marks the end of an era, putting a close to his 20-year political reign, during which the Berlusconi empire largely controlled Italian media.