Telecom Italia bids $9.25 billion for Vivendi’s GVT 

The battle over Brazil’s telecoms market intensified on Thursday as European competitors Telecom Italia and Telefonica made rival offers for Vivendi’s Brazilian broadband business GVT.

Vivendi, which will examine the bids at a Thursday board meeting, must now choose whether to exit its last remaining telecom business after selling off its French and Moroccan mobile operations to focus more on media.

Telefonica, which is indirectly the biggest shareholder in Telecom Italia, would also pay Vivendi with a 12 percent stake in the combined Brazilian entity of which about one third could be exchanged for a 5.7 percent stake in Telecom Italia if Vivendi so chose.

Telefonica said its offer expires on Friday unless it gets exclusive negotiations, in which case it would last for three months.

Vivendi, which owns Universal Music Group and French pay-TV operator Canal Plus, is expected to weigh not just the price and cash on offer from the bidders, but also the strength of the future Brazilian company in which it would own a minority stake.

“The board may decide to take some time to examine the offers or it could decide to negotiate as a priority with one side,” said the person.

Vivendi shares were down 1 percent at 0857 GMT, compared to a 0.4 percent decline in the French CAC-40 index.

Both Telecom Italia and Telefonica’s bids would merge GVT, which serves high-end broadband and pay-TV customers in Brazil, into their respective local mobile businesses.

Source: Reuters

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