In an exciting development, a Paris-based global media and entertainment conglomerate, Vivendi, has recently revealed its intention to study a project that would split its activities into multiple entities. The move comes in response to Vivendi’s realization that its conglomerate structure, since the distribution and listing of Universal Music Group in 2021, has resulted in a “high conglomerate discount.” This has led to a valuation that is lower than the sum of its constituent parts, hindering the conglomerate’s ability to fully unleash the growth potential of its subsidiaries. Vivendi has identified Canal+, Havas, and Lagardère as its subsidiaries currently experiencing robust international growth, making them prime candidates for tapping into numerous investment opportunities. The proposed project aims to list each entity on the stock market, allowing them to flourish independently while providing more room for expansion and development.
Vivendi’s management board, after securing the approval of the supervisory board, intends to explore the feasibility of the restructuring project. Under this new arrangement, the entities would be grouped around three main pillars: pay-TV giant Canal+ Group, communications group Havas, and an investment company with financial stakes in the cultural, media, and entertainment sectors. Additionally, the investment company would hold a majority stake in Lagardère, a market leader in publishing and travel retail. The decision to form these separate entities is driven by the aim of achieving the full liberation of Vivendi’s valuable businesses and maximizing growth opportunities that were previously constrained by the conglomerate structure.
One of Vivendi’s flagship entities, Canal+ Group, boasts a subscriber base of over 25 million across almost 50 countries. Thanks to its recent acquisition of independent Benelux and Central Europe pay-TV group M7, as well as the global media company SPI, Canal+ is well-positioned to capitalize on further consolidation opportunities on a global scale. Furthermore, strategic stakes in businesses such as Multichoice, VIU, and Viaplay allow Canal+ to diversify and expand its reach. This restructuring project would provide Canal+ with the necessary resources and financial agility to pursue its ambitious growth plans.
As for Havas, Vivendi’s communications group, it currently operates across more than 100 countries and employs over 23,000 professionals. Over the past two years, Havas has maintained a steady pace of targeted acquisitions, solidifying its position as a leading player in the industry. With this restructuring project, Havas would have the freedom and flexibility to chart its own course, focusing on further value creation and capital return to its shareholders. The investment company within the newly formed entities would actively support the strategic development of all portfolio companies, bolstering their growth prospects.
The investment company, central to the ambitious restructuring plan, would play a crucial role in supporting the overall development of Vivendi’s subsidiaries. Its primary focus would revolve around value creation and capital return to shareholders through an effective portfolio rotation and a targeted reinvestment policy. By strategically managing its assets, the investment company seeks to enhance the profitability and success of all entities involved. Its financial flexibility would provide the necessary impetus for innovation and expansion, ensuring the long-term sustainability of Vivendi’s investment ventures.
While the proposed restructuring project holds immense promise, Vivendi acknowledges the need for a comprehensive study to prove its added value for all stakeholders involved. This evaluation process will encompass various aspects, including an analysis of the tax consequences associated with the envisioned operations. Vivendi, leveraging its longstanding relationships, will collaborate with its trusted banks and advisors to conduct this study meticulously. The conglomerate aims to gather all the necessary data and insights to make informed and strategic decisions that would benefit its shareholders and the respective entities.
The potential restructuring of Vivendi into multiple entities marks an exciting turning point for the global media and entertainment conglomerate. By liberating its valuable businesses, such as Canal+, Havas, and Lagardère, Vivendi aims to create new growth opportunities and enhance the individual success of each entity. Through this strategic move, Vivendi’s management board and supervisory board aspire to unlock the full potential of their subsidiaries, unleashing unlimited possibilities for expansion and development in the cultural, media, and entertainment sectors. With careful analysis and consideration, Vivendi is poised to embark on an incredible journey towards sustainable growth and success in an ever-evolving industry.