Vivendi Chairman Vincent Bollore Says Company Wants to Increase Investment in French Films

Just a month after warning that Canal Plus’ six pay TV channels would fold if escalating losses continued, Vincent Bollore, the chairman of Canal Plus’ parent company Vivendi, said on Wednesday during a hearing at the Senate, that he thought Canal Plus was back in shape.

The Senate hearing comes two weeks after Canal Plus was denied by the anti-trust board to sign a distribution deal with Al Jazeera’s BeIN Sports, which Bollore had presented as the only remedy to make Canal Plus profitable again — an argument which, along with his claim that he considered shutting down Canal Plus, was seen as a lobbying push.

Bollore, who attended the hearing with Canal Plus Group president Jean-Christophe Thiery,  Vivendi’s deputy CEO Arnaud de Puyfontaine and managing director Maxime Saada, addressed various concerns raised by senators, notably the financial health of the pay TV company, and reports that Canal Plus’ pay TV channels could fold if it was not allowed to distribute BeIN Sports channels, that Canal Plus was considering a revision of its investment in French films and would attempt to concentrate its investment in movies as well as start producing in-house.

Dressed in a chic light grey suit and speaking with a slight accent from his native Brittany, the French billionaire proved once again his showman’s talent with a rhetoric filled with unexpected metaphors which alternatively drew chuckles, puzzled looks and gazes of admiration from his collaborators and senators.

Bollore had to prove his good faith by justifying before the Senate his previous claim that Canal Plus would be losing 400 million Euros in 2016, but at the same time Bollore had to reassure Senate members on the viability of his strategy, which has been intensely criticized since he took the helm of the group in June of 2015.

Analysts and journalists have pointed out Bollore’s figure failed to take into account other parts of the company, notably CanalSat and Studiocanal, which are profitable.

Bollore concurred that “Canal Plus Group as a whole remains profitable with the film activity making 600 million Euros in turnover and 50 to 60 million Euros in annual revenues, an international activity making 2.5 billion in turnover and 250 million Euros in revenues and CanalSat making 1.2 billion Euros in turnover and between 200 and 250 million Euros in revenue.”

Added Bollore, “but the fact is that Canal Plus lost 260 million Euros in 2015, is losing 400 million Euros in 2016 (and an estimated) 460 million Euros in 2017.”

“These losses demands shareholders to inject some cash, but the Anglo-Saxon shareholders who control 85% of Vivendi’s capital won’t be willing to pour in 400 million Euros per year into Canal Plus,” says Bollore, arguing Vivendi had to put Canal Plus on a “diet” and replace 21 executives to control and eventually reduce losses.

“I think that, in reality, Canal Plus is back on its feet. I think that under the ground, once you’ve removed the stones, the roots, put in the fertilizers and the grains, with the water and the sun, things will grown at one point; people are not rejoicing yet but results will be visible quite fast,” said Bollore.

The businessman, who likes talking about Brittany origins, told senators, “I come from the West, where the oyster moves under the lemon but remains an oyster. … I don’t mind taking all the heat and thunders as long my teams can keep working and implement our strategic vision without being disturbed.”

Contradicting local reports, Bollore said Vivendi had no plans to reduce its backing of French movies. “We invest 500 million per year in movies, 200 million in French cinema alone and we co-produce 200 films per year, some big, medium and lots of small ones. We wish to keep investing in French cinema, and even increase it,” said the topper, also mentioning the group’s big push on drama series for its pay TV channels and mobile-native series for its newly-launched platform Studio Plus.

Reacting to criticism that he gets involved in the editorial content of Canal Plus — in particular news and documentary programs (following the last-minute axing of an investigative doc on the financial institution Credit Mutuel) — Bollore said the accusations originated from employees unhappy with the company’s “budget diet.” “This bashing reminds me of that expression saying ‘the one who wants to drown his dog claims he has rabies,'” quipped Bollore.

Certainly targeting the anti-trust board, Bollore emphasized the necessity to allow Vivendi to consolidate in order to become a European “champion” that could rival Google, Apple, Facebook and Amazon.

“If you keep putting up anti-trust measures, no French company will be able to become a champion. These anti-trust concerns are absurd. It’s as if Disney was banned from having a ‘Mickey’ ride or do a cartoon on ‘Snow White.’ In every company in the world we talk about synergies,” said Bollore.

“The convergence between telecoms and content creators is intensifying and the competition within the next few years is going to be extraordinary harsh with the arrival of GAFAs (Google, Apple, Facebook, Amazon). It’s like the invasions that Europe saw in the the year 400 and thereafter,” continued Bollore.

The chairman gave some figures to compare the GAFA’s financial strength — which he estimates at 500 billion in value at the stock exchange — compared with French players: TF1 is worth 2 billion Euros, Lagardere 3 billion Euros and Vivendi 25 billion Euros.

The management of Canal Plus has been under heavy scrutiny since a significant chunk of employees and animators have either been fired or left the company since Bollore took control of the outfit a year ago. Roman Bessi, the COO of Studiocanal — the film and TV production/distribution arm of Canal Plus Group — is the last high-ranking exec to leave the outfit.

Vivendi will hold a press conference on Monday to present what it calls “the new Canal.”

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