- 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.
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.
In an internal memo to staff on Thursday, Yannick Bolloré laid out why a deal would make sense, pointing out that the two firms have a common shareholder and that its teams already have collaborated on some projects.
Yannick Bolloré also said that Havas would bring to Vivendi "its expertise in consumer science, content creation and production and 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.
"It's back to the eighties," said Publicis Groupe SA Chief Executive Maurice Lévy. "I'm not sure advertisers will like that they lose neutrality in their recommendations."
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 13:10 ET (17:10 GMT)