Mediaset rejects Vivendi account of contested deal

Mediaset yesterday poured cold water on Vivendi’s overtures in search of a revised agreement to take a stake in its pay TV arm and develop a strategic partnership with the Italian broadcaster.

Mediaset said that there were currently no negotiations taking place between the pair. It asserted that talks ended with the contract signed on April 8 under which Vivendi agreed to take an 89% stake in Mediaset Premium, with the expectation that Telefónica’s remaining 11% in the pay TV unit would also be sold to the French media giant in due course.

Mediaset further said that Vivendi’s due diligence analysis of Mediaset Premium, the basis for its change of heart over the previously agreed deal, must have taken place prior to the April 8 contract being signed, as is normally the case with major commitments of this type.

Finally, Mediaset said that it had not received from Vivendi any “formal contestation” of the validity of the April 8 contract or its content. Vivendi earlier said that CEO Arnaud de Puyfontaine wrote to Mediaset’s management on June 21 to inform the Italian broadcaster’s management of its concern over “significant differences” in its analysis of Mediaset Premium’s results.

Vivendi meanwhile has confirmed that it had proposed earlier this week to give Mediaset a 3.5% share in Vivendi in exchange for a 20% stake in Mediaset Premium and a 3.5% stake in Mediaset proper, along with convertible bonds into Mediaset shares to be issued by Mediaset to Vivendi in annual installments for the remaining amount.

Vivendi said that the proposal, delivered in what it described as a “constructive letter” to Mediaset, would align the interests of the two groups and would enable Vivendi to bring know-how and pay TV to the Italian market while keeping intact the synergies between pay and free TV activities within Mediaset.

The French media group said it remained committed to building a major strategic alliance with Mediaset and its pay TV arm.