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Spain's Telefonica wins bidding war for Vivendi's Brazil unit GVT
[August 28, 2014]

Spain's Telefonica wins bidding war for Vivendi's Brazil unit GVT


(EFE Ingles Via Acquire Media NewsEdge) Paris, Aug 28 (EFE).- French group Vivendi announced Thursday that it is entering into exclusive negotiations with Telefonica over the sale of its Brazilian broadband unit Global Village Telecom, saying the Spanish telecom giant's bid was more attractive than Telecom Italia's.



"Telefonica's offer is considered particularly attractive, generating a capital gain of more than 3 billion euros ($3.95 billion)," Vivendi said in a press release.

Vivendi's supervisory board decided to embark on exclusive talks with the Madrid-based company "in the light of the group's strategy and in the best interests of its shareholders." The French company said it will submit Telefonica's offer, which valued GVT at 7.45 billion euros ($9.82 billion), compared to TI's 7-billion-euro ($9.22-billion) offer, to the relevant employee representatives.


Vivendi's supervisory board determined that, apart from the price, the remaining conditions of Telefonica's offer "are totally in line" with the group's objectives because they limit "to a strict minimum" its post-sale commitments.

In addition, the agreement with Telefonica "would allow the development of joint projects in content and media" and enable Vivendi to become a shareholder in Telecom Italia by exchanging its shares in Telefonica's Brazilian unit for TI shares.

Telefonica offered Vivendi 4.66 billion euros ($6.1 billion) in cash and a 12 percent stake in Brazilian unit Telefonica Vivo, a third of which could be swapped for 5.7 percent of the share capital and 8.3 percent of the voting rights in Telecom Italia.

Telefonica is the largest shareholder in TI.

The Spanish company's offer "best meets the group's strategic and financial objectives," according to Vivendi, whose move to exit its telecommunications business included earlier divestments of its Moroccan unit, Maroc Telecom, and French phone unit SFR.

The French company said it is shifting to a focus on media and content and will look to expand through the organic growth of its subsidiaries without ruling out "taking minority positions in allied companies to distribute content." Telefonica on Thursday sweetened the bid for GVT it made earlier this month but also forced Vivendi to make a quick decision by announcing that the offer would expire on Friday. EFE ac/mc (c) 2014 EFE News Services (U.S.) Inc.

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