French media company Vivendi has upped the ante in its ongoing battle with Mediaset by stating it could acquire up to a fifth of the Italian broadcaster, leading to speculation over a hostile takeover bid.
The two parties, who have been at odds over a collapsed deal for Mediaset’s pay-television division, Mediaset Premium, have now engaged in a fresh engagement. Vivendi yesterday (Tuesday) said it had raised its stake in Mediaset to 12.3 per cent, one day after announcing that it aimed to raise its interest to 20 per cent from a base of three per cent.
This was met by a response from Fininvest, the holding company of former Italian Prime Minister Silvio Berlusconi and Mediaset’s controlling shareholder, that it had bought 27.6 million shares in the Italian broadcaster and had rights to buy 14 million more today (Wednesday) to reach 39.775 per cent of voting capital.
The Reuters news agency, citing a source close to the matter, said a hostile takeover by Vivendi was not on the agenda “today”, but that the French firm is seeking to strengthen its position to reopen talks with the Berlusconi family. “Vivendi prefers to go with a soft approach for now but if there is no way to discuss, we'll have to reassess at this point,” the source said.
If Vivendi passes a 30 per cent interest in Mediaset, it will be obliged to launch a takeover offer under Italian law. Fininvest said on Tuesday it had filed a complaint with prosecutors in Milan and market regulator Consob against Vivendi, citing market manipulation.
Mediaset, one of the leading sports broadcasters in Italy, is currently seeking damages from Vivendi after it stepped away from an April agreement to take full control of Mediaset Premium.
Fininvest in August filed a claim for damages of €570m ($611m) against Vivendi for allegedly failing to comply with the terms of the takeover deal for Mediaset Premium. Mediaset had earlier asked a Milan court to force Vivendi to fulfil its contract and pay damages of €50m per month, starting from July 25, in a separate claim.
Under the original deal, Vivendi was set to acquire 100 per cent of Mediaset Premium, with both companies taking a 3.5-per-cent stake in each other. Vivendi made a revised offer to sell a 3.5-per-cent stake in its business in exchange for a 20-per-cent shareholding in Mediaset Premium and a 3.5-per-cent stake in Mediaset, but this was rejected by Mediaset at the end of July.