×

A Milan judge on Monday gave Italian broadcaster Mediaset a significant but not definitive victory in its legal battle with French media conglomerate Vivendi by ruling that there are no legal grounds in Italy to a Vivendi motion to suspend Mediaset’s plan to form a pan-European media company based in Amsterdam.

The ruling by judge Elena Riva Crugnola may remove the biggest potential hurdle to carry out a plan by Mediaset, which is controlled by the family of former Italian Prime Minister Silvio Berlusconi, to merge its separately listed Italian and Spanish units into a single pan-European Dutch company called MediaForEurope, or MFE.

However Mediaset must still resolve a similar dispute with Vivendi in Spain where they lost the first round and have appealed. And Vivendi has immediately appealed today’s Milan ruling, they said in a statement.

Mediaset issued a statement saying they are going forward with the MFE plan.

The combined company would operate in Italy, Spain and Germany, where Mediaset recently acquired a 9.6% stake in broadcaster ProSiebenSat1.

Vivendi, which is owned by French billionaire Vincent Bollore, and Mediaset have been fighting in various courts ever since a botched 2016 pay-TV deal. As their alliance went sour, Vivendi built up a 28.8% stake in Mediaset, becoming its second-biggest shareholder behind the Berlusconi family, which holds a 44% stake in the company through their holding company Fininvest.

Mediaset has managed to have most of Vivendi’s voting rights frozen on antitrust grounds citing Italian media cross-ownership laws because Vivendi also owns a large chunk of Telecom Italia. With Vivendi’s voting rights largely frozen Mediaset has already obtained shareholder approval for the merger plan.

Vivendi claims Italian cross-media regulations are contrary to EU law and have taken the case to Brussels where a EU court decision is not expected anytime soon.

Vivendi in its motion to the Milan court said it opposes Mediaset’s pan-European merger calling it a pretext by the Berlusconi family to strengthen its grip on the company and not a sincere attempt to build a pan-European powerhouse to compete with the likes of Netflix.

But the Milan court in its ruling stated that the papers filed by Vivendi to support its claim instead indicated that blocking the merger would damage Mediaset and its employees by “impeding this indispensable expansion operation.”