Vivendi taking 26% stake in Banijay-Zodiak

Vivendi has signed an agreement to take a 26.2% stake in the new production company resulting from the combination of Banijay Group and Zodiak Media.

Vivendi had previously confirmed it was in talks to take a minority stake in the production outfit.

The Banijay-Zodiak transaction, scheduled to complete in the first half of next year, will involve a cash payment of €290 million, with Vivendi paying €100 million to acquire a stake in the combined company and participating in two bonds of €100 million and €90 million to be issued by Banijay Zodiak and Lov Banijay, a holding structure controlled by Financière Lov, respectively, each of which is redeemable at the issuer’s option in shares or cash. Both bonds have a seven-year maturity.

In addition, Vivendi has confirmed that it is taking a 30% interest in Mars Films, a leading French feature film producer and distributor.

In an analyst call following Vivendi’s third quarter results announcement, Vivendi CEO Arnaud de Puyfontaine said that the acquisition was “part of a series of operations aimed at consolidating our presence throughout the TV value chain”.

Du Puyfontaine said that Vivendi’s involvement in the production outfit would deliver high quality intellectual property that would enable Vivendi to deliver content and increase the value of Canal+, the group’s pay TV outfit.

Du Puyfontaine also confirmed that Vivendi would continue to build its acquisition of shares in video game companies Ubisoft and Gameloft “based on market conditions”. He said that the group was “open to discussion” with the two game companies about the scope of Vivendi’s future involvement

Vivendi has made a series of appointments to reflect its new focus. The company named Frederick Crepin, senior executive vice-president and Group General Counsel and Simon Gillham, chairman of Vivendi Village and senior executive vice president, communication to the management board, while Stephane Roussel, an existing management board member, has been named as chief operating officer.

Vivendi’s revenues for the third quarter rose 4.5% to €2.52 billion, while EBITA dropped by 29.2% to €219 million. Revenues dropped slightly at constant currency rates, but the group’s performance was boosted by currency impacts on Universal Music Group.