Vivendi Mulls $4.5 Billion Bid for Remaining Numericable-SFR Holdings

Vivendi Chairman Vincent Bollore - H 2015
AP Images

Vivendi Chairman Vincent Bollore - H 2015

The latest deal would leave StudioCanal and Universal Music Group owner flush with cash as it eyes media and music acquisitions.

Vivendi has received a $4.5 (€3.9) billion binding offer from telecoms operator Altice on its 20 percent stake in Numericable-SFR, an internet and telecom giant created in a merger last year after Vivendi sold most of mobile phone provider SFR to cable company Numericable.

The offer comes as Vivendi is in the midst of a transformation into a media company, having sold more than $30 billion of assets, including Santa Monica-based video game maker Activision Blizzard and additional phone company holdings since 2012. It already owns StudioCanal, international pay-TV giant CanalPlus and Universal Music Group, but the cash would give the company deep pockets for additional acquisitions as it refocuses its business on media and music.

Chairman Vincent Bollore has made it clear he will remake Vivendi from a telecom into an integrated entertainment operation since becoming the company's largest shareholder in 2012 and taking over the top position last year. Observers have long expected Bollore to purchase new media properties to bolster the group, though he has so far focused on strengthening synergies between existing properties.

The company has so far started out strong in 2015, with two major initiatives.

First its UMG, home to pop's biggest stars including Katy Perry, Lady Gaga, Rihanna and Justin Bieber, announced a partnership with advertising group Havas, in which Bollore also holds majority control.

The new Global Music Data Alliance aims at boosting artist revenues through data mining and marketing in order to combat falling physical record sales, promoting ticket sales through its event and concert ticketing arm, and forming partnerships with brands and artists.

It also created Vivendi Contents with the aim at developing new formats across music and video as part of their monetizable content creation initiatives. Internal communications revealed in news reports at the time also indicated the company was looking at talent management and development models, similar to a talent agency.

Whatever Bollore's intentions, it's been a banner year for its flagship StudioCanal. The international blockbuster Paddington, which has taken in more than $218 million at the box office, and the successes of Liam Neeson thriller Non-Stop and Oscar-nominated The Imitation Game, have solidified its place as Europe's top film finance and production company.

Pay-TV giant CanalPlus has also made a strong move, launching a pan-African group of channels with international and locally produced films and television — including a local version of the Idol format and a Sex and the City-style dramedy — marketed towards the fast-growing demographic of middle-class Africans in last July.

Vivendi's supervisory board will meet Feb. 27 to decide if they will accept the offer. If approved, the deal would close in the days after Numericable-SFR's April 30 shareholder meeting, half a share buyback and the rest in a lump sum payment in April 2016, leaving Vivendi flush with cash.