Lagardère likely to move on Canal Plus sale, say analysts

French defence-to-media conglomerate Lagardère could make around €1.3bn from the sale of its 20% stake in pay-TV group Canal Plus if it disposes of the stake early next year, according to analysts interviewed by the Reuters news agency.

Lagardère must decide by the end of this month whether to exercise an option to increase its stake in the pay-TV operator to 34%, something that the analysts cited by Reuters believe to be unlikely, despite comments by chief executive Arnaud Lagardère in May that the group might exercise the option and sell its stake on.

Analysts including Edward Hill-Wood of Morgan Stanley believe Lagardère is more likely to exercise its option to sell the stake in March or April next year following the exit from Canal Plus of TF1 and M6, which hold stakes of 9.9% and 5.1% respectively in the pay-TV provider.

Lagardère is expected to use the proceeds from any sale to reduce debt and possibly also to make acquisitions in sports rights or publishing. The group is also mulling the sale of its stake in defence group EADS, but any sale is likely only to be after the completion of an investigation by financial regulator the AMF into the sale of shares in the company in 2005-06.