Vivendi heir vows to prove business works as an integrated group
Yannick Bolloré wants to show French media company is not just a ‘conglomerate of shareholdings’
The heir to Vincent Bolloré’s media group has pledged to prove that Vivendi is a coherent company and not a disparate set of holdings, a goal that has been promised many times but not yet achieved by the family-backed enterprise.
“The challenge we have at Vivendi is to prove that we are an integrated industrial group, present throughout the value chain of entertainment, media and culture and not a conglomerate of shareholdings,” Yannick Bolloré told the Financial Times, one year after his father, corporate raider and industrialist Vincent Bolloré, officially retired from the company.
“This would allow us to reduce the holding discount, which would create a lot of value,” Bolloré added.
Vivendi is at a point of transition, both in terms of the elder Bolloré stepping back from the limelight and the composition of the group. Vincent Bolloré first invested in the French group roughly a decade ago and has since held a minority stake of just under 30 per cent. Yet as chairman he has also long set its direction.
He presided over the slimming down of the company via asset sales and added advertising agency Havas. The most recent sale came when Vivendi spun out its biggest and most valuable business via a listing of Universal Music Group two years ago. That left it with a much smaller business in pay-TV with Canal Plus, Havas and some print magazines.
While UMG — in which the stakes of the Vivendi and Bolloré family holding companies combine to make them the biggest shareholder — is now valued at more than €40bn, a slimmed down Vivendi is currently valued at €10.8bn.
The younger Bolloré, who became chair of Vivendi’s supervisory board in 2018 and remains chief executive of Havas, now faces the challenge of turning Vivendi into a more cohesive group. He announced a plan last year to knit together the group’s holdings — for instance, using material developed in its publishing houses to develop television series for Canal+ — while growing its businesses outside France.
The group is now negotiating with European competition authorities in the hopes of getting approval for its proposed takeover of French media and retail group Lagardère, which owns book publisher Hachette, the world’s third-largest publisher. But since it already owns Editis, a French-focused publishing business with significant market share, regulators have demanded that this be sold.
Vivendi had proposed to regulators that it spin out Editis in a so-called share distribution and sell its remaining stake in a two-stage process.
Yannick Bolloré said he expected to have a final response from the EU on buying Lagardère by early summer, following meetings in Brussels last week.
“Brussels had preferred the simplest solution [of an outright sale] and the share distribution is not common, so [it is] a little new. Brussels is open to new ideas but wants to be certain about them,” he said.
Three parties — an alliance of businessmen Stéphane Courbit, Daniel Kretinsky and Pierre-Edouard Stérin, Canadian group Quebecor and media group Reworld — have submitted bids for the Bolloré holding company’s remaining stake in Editis after the spinout, with the buyer expected to be chosen soon.
Vivendi on Wednesday reported an annual net loss of €1bn after revaluing and removing its stake in indebted group Telecom Italia from its balance sheet, having recorded record profits of €24.7bn in 2021 following the listing of UMG.
Revenues rose 10 per cent to €9.6bn. When the contribution from Vivendi’s stakes in Lagardère and UMG were excluded, earnings before interest, tax, amortisation and depreciation grew 10 per cent to €646mn.
Vivendi shares have fallen roughly 9 per cent in the past year, compared with a 17 per cent rise for the Stoxx 600 Europe Media index.
Canal+ has been betting on international expansion to grow and now has around two-thirds of its subscribers outside France. The broadcaster also recently increased its shareholding in South African pay-TV operator MultiChoice to more than 30 per cent, just below the threshold that would trigger a mandatory offer to shareholders.
The two complement each other geographically. Canal+ operates across much of west Africa, while MultiChoice spreads across the south and centre of the continent.
“The idea for Canal+ is to grow its subscriber base to make its content available to a wider base of subscribers either through acquisitions or partnerships,” Bolloré said. “The idea is to create a group or community of companies that can compete with big television platforms.”