Live Nation investor tried to buy Universal – Vivendi said no

If Vivendi’s commitment to the future of Universal Music Group was ever in doubt, it’s not anymore.

With US $11bn (€10bn) cash reserves sitting in the bank, business media tongues have been set wagging about what Vivendi’s next corporate move will be – and this hubbub appears to have shaken loose new information about the French conglomerate’s belief in UMG’s future.

The chairman of US group Liberty Media, John Malone, reportedly enquired about buying the major label in the past few months, but his approach was roundly rejected.

How much did Malone offer? The New York Post doesn’t say – but it’s probable that it was somewhere upwards of $8bn: in 2013, Japanese company Softbank made an $8.5bn bid for UMG, then thought to be $2bn more than the company’s true valuation.

The approach was rejected by Vivendi around the same time that it was offloading another key entertainment asset, video games firm Activision Blizzard.

Then in June last year, Credit Suisse – in an optimistic report that suggested the global recorded music biz would return to growth in 2016 – valued Universal at $10bn.

Malone apparently approached influential Vivendi stakeholder Vincent Bolloré personally to make his interest in UMG clear, but the Frenchman wasn’t having any of it.

Liberty, a majority stakeholder in Sirius XM and a significant investor in Live Nation, ironically won a $950m lawsuit against Vivendi in 2013. It sued the French company – which is appealing – for allegedly inflating the value of shares it used to purchase Liberty’s stake in USA Networks in the past.

Vivendi now owns just two media businesses – UMG and French TV Company Canal + – which it has vowed to place at the centre of its business structure.

Meanwhile, Bolloré, who recently upped his Vivendi stake from 5.2% to 8.2%, is the subject of a speculative piece in The Wall Street Journal regarding what he may do that mountain of $11m cash reserves.

Bolloré has previously mentioned that further expansion into Africa could help facilitate an “industrial integrated content group”.

The WSJ also mentions that he has ambitions to turn Vivendi into “a French version of German media group Bertelsmann” by pooling various media companies in French-speaking countries under one roof.

Vivendi sold its minority 20% stake in Numericable SFR last month for €3.9bn ($4.4bn) – a price which frustrated some shareholders, who thought it had been flogged too cheaply.Music Business Worldwide

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