Vivendi riled over rumors

Talks of tax breaks, upset shareholders taint merger in French press

PARIS — Vivendi struck back Wednesday against the suggestion that it might be held for ransom by Canal Plus’ minority shareholders not satisfied with the Vivendi-Seagram deal.

Earlier this week, the Assn. des Actionnaires Minoritaires, (Adam), lead by Colette Neuville, claimed French regulations governing mergers meant the new group would have to offer cash for the shares of any minority shareholder who wanted to relinquish them.

Neuville’s comments were widely reported in the press.

Returning fire Wednesday, Vivendi issued a statement saying the company was “astonished by the position Neuville has taken in the name of the Adam.”

The statement went on to say that laws relating to broadcasting companies prevented Vivendi from offering to buy the 51% of shares it doesn’t own in Canal Plus.

Moreover, it pointed out that the court of appeal had ruled in Vivendi’s favor in 1998, when the Adam had challenged the company on similar grounds for acquiring South African company Richemont’s 15% stake in Canal Plus.

But the flack against Vivendi may not stop there.

Tax issue

The company refused to comment Wednesday on French press reports that the new Vivendi Universal could receive a 5 billion franc ($634 million) tax break from the French government.

The daily newspaper Le Figaro was the first to claim Finance Minister Laurent Fabius intended to waive taxation on the capital gains created by the three-way merger between Vivendi, Canal Plus and Seagram.

Such a gesture, Le Figaro speculated, would reflect political approval for a deal that creates a media giant second in the world only to AOL-Time Warner.

A spokesman for Canal Plus strenuously denied Vivendi Universal might benefit from government largesse, saying if the group were not required to pay the tax, it would be “for reasons strictly to do with fiscal law, not as a gift to the company.”

“The question was raised, and now it is up to the Ministry to examine the appropriate articles of the law,” the spokesman said.

A Finance Ministry spokesman said a decision had “yet to be taken.”

Keeping up pressure

But France’s satirical magazine Le Canard Enchaine refused to let the matter drop Wednesday, claiming the “leak” in Le Figaro had caused considerable embarrassment to the ministry, which now found itself in a no-win situation between honoring its assurances to Vivendi and becoming embroiled in a scandal.

The daily Les Echos cited articles of fiscal law that showed there was “nothing to stop” the finance minister from saving Vivendi Universal from the tax man.

The paper said that while such a break could not be conditional upon Vivendi Universal complying with political constraints, it would doubtless “maintain political pressure on Vivendi so that its transformation into a world company would not be to the detriment of France’s cultural position.”

More Biz

  • Brian Roberts Sun Valley Conference

    Merger Mania Dominates Talk at Sun Valley Moguls' Confab

    PARIS — Vivendi struck back Wednesday against the suggestion that it might be held for ransom by Canal Plus’ minority shareholders not satisfied with the Vivendi-Seagram deal. Earlier this week, the Assn. des Actionnaires Minoritaires, (Adam), lead by Colette Neuville, claimed French regulations governing mergers meant the new group would have to offer cash for […]

  • Discovery Extends CEO David Zaslav's Contract

    Discovery Extends CEO David Zaslav's Contract Through 2023

    PARIS — Vivendi struck back Wednesday against the suggestion that it might be held for ransom by Canal Plus’ minority shareholders not satisfied with the Vivendi-Seagram deal. Earlier this week, the Assn. des Actionnaires Minoritaires, (Adam), lead by Colette Neuville, claimed French regulations governing mergers meant the new group would have to offer cash for […]

  • Sire Records Cofounder Seymour Stein Leaving

    Sire Records Co-Founder Seymour Stein Leaving Warner Music Group After Four Decades

    PARIS — Vivendi struck back Wednesday against the suggestion that it might be held for ransom by Canal Plus’ minority shareholders not satisfied with the Vivendi-Seagram deal. Earlier this week, the Assn. des Actionnaires Minoritaires, (Adam), lead by Colette Neuville, claimed French regulations governing mergers meant the new group would have to offer cash for […]

  • Mark Zuckerberg

    Five Things We Learned From Mark Zuckerberg's Interview With Recode

    PARIS — Vivendi struck back Wednesday against the suggestion that it might be held for ransom by Canal Plus’ minority shareholders not satisfied with the Vivendi-Seagram deal. Earlier this week, the Assn. des Actionnaires Minoritaires, (Adam), lead by Colette Neuville, claimed French regulations governing mergers meant the new group would have to offer cash for […]

  • Jay-Z Slams Philadelphia Mayor for Made

    Jay-Z Slams Philadelphia Mayor for Made in America Festival Move

    PARIS — Vivendi struck back Wednesday against the suggestion that it might be held for ransom by Canal Plus’ minority shareholders not satisfied with the Vivendi-Seagram deal. Earlier this week, the Assn. des Actionnaires Minoritaires, (Adam), lead by Colette Neuville, claimed French regulations governing mergers meant the new group would have to offer cash for […]

  • Steph Curry Uncovered

    Steph Curry Says He Would 'Jump' at the Chance to Act

    PARIS — Vivendi struck back Wednesday against the suggestion that it might be held for ransom by Canal Plus’ minority shareholders not satisfied with the Vivendi-Seagram deal. Earlier this week, the Assn. des Actionnaires Minoritaires, (Adam), lead by Colette Neuville, claimed French regulations governing mergers meant the new group would have to offer cash for […]

More From Our Brands

Access exclusive content