Canal+ CEO Bertrand Meheut has weighed in to the dispute between parent company Vivendi and one of its shareholders, P. Schoenfeld Asset Management, over the company’s cash policies and future strategic direction.
In remarks widely reported in the French press, Meheut said that according to the logic of so-called activist investors of this type, which call for the dismantling of enterprises as a way to raise their value, every part of Canal+ could be separated from the whole. He said that the sale of assets to improve the remuneration of shareholders could lead to the destruction of the group.
Meheut said that the Vivendi’s ownership of Canal+ allowed it to make significant investments in content.
Earlier, a group of four French unions published an open letter expressing their concern about Schoenfeld’s initiative, warning against the dismantling g of a system that favours employment and creation.
Vivendi is to put requests from the US activist hedge fund to increase the amount of cash to be returned to shareholders for the 2014 financial year and to reject compliance with France’s so-called Florange law, designed to protect employees in the case of takeovers, to its shareholders meeting.
The Florange law grants double votes to shareholders of more than two years standing. Implementation of this would give Vivendi chairman Vincent Bolloré between 13-15% of the voting rights in the company, a move strongly opposed by Schoenfeld.
Vivendi has indicated that moves by Schoenfeld and other foreign investors in concert could lead to a breach of rules limiting the participation of non-EU investors in media groups to 20%
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