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Mediaset suffers major setback as Vivendi secures MFE legal victory

Mediaset’s plans to combine its Italian and Spanish arms under a new Dutch-registered holding company have suffered a serious blow with a ruling from a Spanish court that the merger cannot go ahead.

The Spanish judge considering the case upheld the suspension of the merger, confirming an earlier court ruling from October that led to Mediaset and Mediaset España approving certain changes to the proposed statute of the new organisation, MediaForEurope (MFE).

The court’s rejection of Mediaset’s appeal against the October ruling is a serious setback for the broadcaster and comes after a Dutch court pushed back a decision on a separate case brought by Vivendi to September 1.

Mediaset said the ruling “causes serious damage” to the company and its Spanish subsidiary and “to all shareholders of the two companies as well as to the entire European television ecosystem”.

The Italian media outfit said that “since the birth of a new pan-European broadcaster is objectively made more and more indispensable by the new economic scenario” it would resume the merger operation “on a new basis” as soon as possible.

Mediaset went on to condemn Vivendi for its “purely instrumental” attempts to block the merger to prevent a serious competitor emerging, “even after the health emergency that has seriously affected the European television sector”.

Mediaset also condemned Vivendi for seeking to block the merger through the courts in Spain by acquiring a 1% stake in Mediaset España after the merger plan had been outlined. “What is the purpose of joining a company if you do not agree with its strategy?” it said.

Mediaset maintains that Vivendi’s alleged “design will not be successful, since the need for a European television union has been made even more urgent by the market crisis engendered by COVID” and said it would “continue with the international development path” it has embarked on which will be “presented again along a new path” that would avoid “the pitfalls” created by “those interested only in instrumental financial manoeuvres”.

That ‘new path’ remains to be defined however, and for now the merger remains on hold.