Vivendi could seek all of SFR unit at right price

AP News
Posted: Mar 16, 2011 8:20 AM
Vivendi could seek all of SFR unit at right price

Vivendi SA's chief executive said Wednesday the media conglomerate has the financial means to take full control of French mobile operator SFR from partner Vodafone Group PLC and may pursue a deal if the price is right.

Paris-based Vivendi has cash to buy out Vodafone's minority interest after selling off its stake in NBC Universal earlier this year, CEO Jean-Bernard Levy said. He wouldn't confirm whether the two companies are engaged in talks on a deal, but said Vodafone appears to be willing to sell.

"We are in a situation where a potential transaction could be prepared," Levy told reporters on the sidelines of a media conference in the Emirati capital Abu Dhabi. "I believe at the right price it would be in the interest of Vivendi to acquire 100 percent of SFR."

Vivendi owns 56 percent of SFR, which generates more revenue for the conglomerate than any other division. It has reportedly been seeking to pay about 6 billion pounds ($9.65 billion) for the rest of SFR that Vodafone holds _ a figure Levy wouldn't confirm. Vodafone is believed to want considerably more.

A Vodafone spokesman declined to comment.

Vivendi sold its remaining stake in NBC Universal to General Electric Co. earlier this year. It got a total of $5.8 billion for its 20 percent interest in the U.S. company, which owns U.S. broadcast network NBC, the Universal Pictures movie studio and related theme parks and a number of cable channels. The deal laid the groundwork for cable giant Comcast Corp.'s takeover of NBC Universal.

The conglomerate could tap its existing lenders if it needs to drum up additional cash but wouldn't consider issuing new shares to fund an SFR deal, Levy said.

Vivendi operates a range of businesses, including Universal Music, the record label behind Eminem, Lady Gaga and Justin Bieber and Rihanna. It also controls video game maker Activision Blizzard, Brazilian telecom company GVT and Canal Plus television.

Even as it mulls boosting its SFR stake, Levy said Vivendi is willing to stick to its 80 percent holding in Canal Plus after failing in its bid to buy the rest of the French pay television service.

Vivendi made minority shareholder Lagardere what Levy called "a fair offer" for the stake but was rebuffed. He didn't say how much Vivendi bid. Lagardere is preparing to sell its stake to the public instead.

Levy reiterated his expectation of slight earnings growth in 2011 _ an expected gain he described as "positive but not significant."