Vivendi Makes Offer to Acquire Groupe Bolloré's Stake in Havas for EUR2.36 billion -- Update

By Nick Kostov Features Dow Jones Newswires

- Vivendi SA has made an offer to buy a EUR2.36 billion stake in advertising group Havas SA from the media conglomerate's own chairman, Vincent Bolloré

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Vivendi's offer values Havas at EUR9.25 a share, a premium of 8.8% over its closing price on Wednesday. The offer is to buy all of the 60% stake owned by Vincent Bolloré in Havas. Mr. Bolloré also controls Vivendi with a stake of more than 20%.

Should the offer lead to a deal, it will see greater ties between Vivendi's units including Universal Music Group and StudioCanal, and Havas's creative and media business.

"After having consolidated its foundations, Vivendi is now entering a new phase in its development and this transaction will give the Group a new dimension to compete against powerful global players," Vivendi said.

In a news release, Havas said it had "taken note" of Vivendi's offer.

In the past three years, the elder Mr. Bolloré has fostered closer cooperation between Vivendi's units in a bid to create an industrial integrated content group with a focus on Southern Europe. Last year, he nominated his son, Yannick, chief executive of Havas, to the board of Vivendi.

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During Havas's first-quarter earnings call last month, Yannick Bolloré laid out why such a move would make sense, including pointing out that the two firms are "cousin company with a common shareholder" and that both are in the communications industry.

"Content is important to advertising agencies like Havas. And Vivendi, of course, is one of the best content producers and distributors," he said.

Yannick Bolloré also said data is important to Vivendi and his company Havas is an "expert in how to convert Big Data into insights and smart data."

Any tie-up would raise conflict-of-interest issues given Vivendi's ownership of media assets like Canal Plus. Havas earns a large percentage of its revenue from buying advertising space on TV and radio, in print and online.

In an interview with The Wall Street Journal last year, Yannick Bolloré described the conflict as "marginal" because Vivendi represents 0.5% of Havas's revenue and Havas's clients account for 0.9% of Vivendi's revenue.

He said at the time that the conflict already exists because the two companies share a common shareholder and an agreement is in place to keep the media buying arm separate from the unit that owns media.

Write to Nick Kostov at Nick.Kostov@wsj.com

(END) Dow Jones Newswires

May 11, 2017 12:33 ET (16:33 GMT)