Firm takes pause on offer
Sebastian Holdings, which wants to buy Vivendi and split it up, said Wednesday that it’s no longer in talks with the French conglom and that it “continues to assess the situation.”
Vivendi execs rebuffed an offer from Sebastian, holding company of financier Alexander Vik, a few weeks ago. At a press conference June 1, they called the firm’s plan “unfeasible” and “stupid.”
But Vivendi chairman Jean-Rene Fourtou indicated then that a deal, while unlikely, could be hypothetically possible if it carried a 20%-30% premium over Vivendi’s current market price. He said Sebastian could never do that size deal alone but would need a roster of deep-pocketed private equity firms.
“In comparison with all the offers that we’ve gotten over the years, this is one of the least professional ones that we received,” Fourtou said.
Sebastian’s statement Wednesday — oddly, nearly a week after the press conference — said it was pleased by management’s comments, “which for the first time suggested that they would consider an alternative to the convergence strategy Vivendi is currently following.”
An incensed Vivendi put out its own statement soon thereafter declaring that it “categorically denies the assertion that on June 1 (its execs) opened the way to an alternative strategy” to the one the company is currently pursuing.
“Vivendi reiterates that on May 17 last, the supervisory board and the management board made it public that they had unanimously rejected the alternative strategy proposed by Sebastian Holdings aimed at breaking up the group. On the contrary, they unanimously reaffirmed their intention to pursue the current strategy, which is the most appropriate one to create value for Vivendi shareholders.”
Vik, a Norwegian who lives in Monaco, has been needling Vivendi for months, trading verbal jabs as financial markets on both sides of the Atlantic try to figure exactly out what’s going on. Sebastian hired Abernathy MacGregor as its liaison Stateside as well as reps in Paris and London.
Vik had lined up some financing for a takeover from Bank of America and Deutsche Bank, both of which had indicated they’d only participate in a friendly deal, not a hostile one.
French regs prohibit foreign ownership of Canal Plus, and a purchase of mobile phone company SFR would have heavy tax implications. But Vik’s people insist a deal is still feasible.
Sebastian came out of left field as Vivendi had improved its finances, chopped the “Universal” off its name and is preparing to delist itself from the New York Stock Exchange in August.
But Vik’s claims have resonance given the business trend of dismantling giant congloms, which many think have outlived their usefulness.
Viacom split in half; activist investor and corporate raider Carl Icahn tried to force Time Warner to break itself up. While Icahn has moved on, pressure is mounting both inside and outside TW to do just that.