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Suez channels web stake

M6 parent looks to dispose of its share in Gallic web

PARIS — Diversified conglom Suez is expected to propose a disposal program of its 37.6% share in private French web M6, which would see a significant percentage of its stake floated on the stock market.

Suez prexy Gerard Metrallet will meet with the Gallic audiovisual watchdog, the Conseil Superieur de l’Audiovisuel (CSA), Oct. 22 to propose a deal under which Suez would keep between 5%-6% of M6 and ask three French banks to each take between a 1%-3% stake, according to a French newspaper report.

Suez and the banks — Caisses d’Epargne, Credit Agricole and Caisse des Depots — would together hold between 8%-15% of the web’s capital and would be linked via a shareholder pact.

The remaining 22%-29% would then be floated on the French bourse — a significant increase to the 15% already traded on the market — at a small 2%-3-% discount to assure the success of the sale. Under the plan, Suez would pocket about 1 billion euros ($1.18 billion), keeping a $236 million investment in M6.

Suez announced at the beginning of the year that it planned to sell its media assets as part of a debt-reduction plan, but the company has had trouble finding suitors for M6 due to the fact that RTL Group owns 47.5% of Gaul’s second leading private web, and to French law which prohibits a foreign company from owning more than 49% of a Gallic channel.

Would-be French suitors, such as media group Lagardere, have little interest in paying in the $1.4 billion price-tag for a minority stake in the web, despite its handful of theme channels and its stake in satcaster TPS.

Furthermore, the CSA has already made it clear to Suez that it would reject any plan to float the entire 37.6%.

The fact that French banks would be buyers of a percentage of the stake could go someway to appeasing the CSA, which above all doesn’t want to see M6 fall into foreign hands. But it remains to be seen if under the Suez-banking alliance the equilibrium of voting rights would be maintained, a point which could derail the deal for Suez.

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