Paris-based global media and entertainment conglomerate Vivendi has recently announced its plans to study the feasibility of splitting its activities into multiple entities. Facing a “high conglomerate discount,” which has resulted in the company’s valuation being lower than the sum of its parts, Vivendi is looking to unlock the full potential of its subsidiaries. Its current subsidiaries, including Canal+, Havas, and Lagardère, have been experiencing strong international growth and could benefit from new investment opportunities.
To fully unleash the development potential of its activities, Vivendi’s Management Board has proposed a project to split the company into several entities, each of which would be listed on the stock market. The new entities would be centered around Canal+ Group, Havas, and an investment company holding stakes in the cultural, media, and entertainment sectors. This investment company would also have a majority stake in Lagardère, a market leader in publishing and travel retail.
Canal+ Group, one of Vivendi’s subsidiaries, currently boasts a subscriber base of over 25 million in nearly 50 countries. With this strong presence, Canal+ is well-positioned to capitalize on consolidation opportunities on a global scale. Vivendi recently acquired Benelux and Central Europe pay-TV group M7 and global media company SPI, along with strategic stakes in businesses such as Multichoice, VIU, and Viaplay.
Havas, another subsidiary of Vivendi, is a communications group with 23,000 employees spread across more than 100 countries. The company has been actively making targeted acquisitions over the past two years, demonstrating a commitment to growth and expansion.
The proposed investment company would play a significant role in supporting the strategic development of Vivendi’s portfolio companies. Its focus would be on value creation and capital return to shareholders. Through effective portfolio rotation and a targeted reinvestment policy, the investment company aims to maximize returns. This split project would provide all the entities with the necessary resources and financial agility for their development.
Before moving forward with the split project, Vivendi acknowledges the need to demonstrate its added value for all stakeholders. This includes conducting an analysis of the tax consequences of the proposed operations. To ensure a thorough study, Vivendi will be assisted by its customary banks and advisors.
As Vivendi explores the potential of a split, it is clear that the company is seeking to optimize its operations and foster growth. By creating separate entities focused on specific sectors, Vivendi aims to enhance the value of each subsidiary and provide them with greater opportunities for expansion. The proposed split could unlock untapped potential and position Vivendi as a leader in the global media and entertainment landscape.