The Bolloré group and Vivendi called to become one


Each major operation at Vivendi – the IPO of Universal Music, the takeover bid for…

The Bolloré group and Vivendi called to become one

The Bolloré group and Vivendi called to become one

Each major operation at Vivendi – the IPO of Universal Music, the takeover bid for Lagardère, etc. – has for some time revived speculation on an imminent reinforcement of the Bolloré group in the capital of Vivendi, its media subsidiary present in television with Canal+, publishing soon with Hachette, magazine press with Prisma and even advertising with Havas.

But since the Bolloré group has ceded its African ports last year and especially now what concluded cession logistics activities , financial circles have few doubts. Vivendi becoming the main activity of the Bolloré group, it is called to become one – or almost – with its parent company, and this in the short term, bet the markets.

Holder of a little less than 30% of the capital and voting rights, the Bolloré group should thus try to p*** to at least the majority, thanks to a takeover bid not necessarily intended to end in withdrawal from the rating. Vivendi could also launch an OPRA on itself which would considerably reinforce Bolloré Group in its capital, evoke certain connoisseurs.

Balance industries – media

With Vincent Bolloré, whose talents as a trader and industrialist they salute, investors know that they are not immune to surprises. They were few to expect the sale of this logistics activity. The group has indeed been walking for many years on two legs, the media professions rather entrusted to Yannick Bolloré and the industrial professions under the responsibility of his brother Cyrille Bolloré, the two most operational children of Vincent Bolloré.

The Bolloré group being rich – it also holds an 18% stake in Universal Music (UMG) – another industrial acquisition cannot be ruled out. Adrien de Saint Hilaire, analyst at Bank of America, also points out that “Bolloré Group will soon ask its AG to issue shares in order to possibly launch an OPE, which it has not done since 2019”. The group gives itself maximum leeway.

Holding discount

But several reasons could encourage a consolidation between the Bolloré group and Vivendi now. First, the first, a shareholder for many years in the second, will for technical reasons mechanically go above 30% of voting rights this summer, the threshold triggering the takeover bid. Vincent Bolloré could decide to resell securities and remain below the threshold, just as he could request a waiver not to trigger an offer – he has already done so with Havas. But at over 70, he wants to bring order to the empire, the management of which he will p*** on to his descendants. In addition, he would strengthen in a discounted ***et, which he likes. “Vincent Bolloré is more of an investor looking for rather low-valued ***ets than growth ***ets that are expensive. As he indicated during a hearing in the Senate, he considers the profitability and return on investment of the media over the long term very attractive,” notes Adrien de Saint Hilaire.

The markets are indeed not convinced by the operational coherence between them of Vivendi’s activities. Also its valuation on the stock market suffers from a “holding discount” of 30% which means that the whole thing is worth 30% less than if all the activities were sold separately.

Weak growth profile

The possible disappearance of part of this discount in favor of an offer supports Vivendi’s share price. “The Bolloré group will certainly not offer to correct all the discount, but it is for this prospect of supply that people invest in Vivendi”, says a good connoisseur.

Vivendi’s growth profile has the merit of being defensive in these difficult times of inflation, with pay TV and publishing being resilient. But, while the group remains entangled in the Telecom Italia case, its growth profile is weak, at least for minority investors. “I do not see the stock market history, continues this good connoisseur. The jackpot was UMG”. By choosing to wait several years before splitting UMG from Vivendi, Vincent Bolloré had perhaps made his finest operation. She played a major role in the distribution in dividends and share buybacks of 35 billion euros to Vivendi shareholders since the takeover by the Breton businessman.

Cyrille on the board of UMG

Bolloré’s refocusing on the media, which until recently only accounted for half of sales, raises another question for investors. What will Cyrille Bolloré do, who seemed to have to preside over the destinies of his father’s group through his industrial activities. How will he share the task with his brother Yannick, who is chairman of the Vivendi supervisory board. “There is work to be done to simplify the holdings of the family for several years, notes on this subject Adrien de Saint Hilaire. It is also interesting to note that it was Cyrille who was appointed to the board of Universal Music, where he rubs shoulders with experienced investors and managers and will thus be able to perfect his knowledge of the issues and problems of the monetization of content and digital uses. »

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