Mediaset Shareholder Fininvest Files for Contract Enforcement, Damages
24 August 2016 - 3:27AM
Dow Jones News
By Manuela Mesco
MILAN--Mediaset's largest shareholder, Fininvest SpA, said
Tuesday it has filed a request with a Milan court to seek
enforcement of a contract with French firm Vivendi SA to sell
Mediaset's pay-tv unit.
Fininvest, the holding company owned by the family of Italy's
former premier Silvio Berlusconi, is also claiming compensation for
a total of 570 million euros for damages already caused, as a
contract signed in April has not been honored yet.
In April, the French company agreed to acquire its Italian
counterpart's pay-TV unit in a deal that included swapping 3.5%
stakes between Mediaset and Vivendi.
But three months later, the French media group sent a letter to
Mediaset proposing new terms for the deal. Vivendi would buy only
20% of the pay-TV unit and it would acquire 15% of Mediaset itself
in three years.
Vivendi said that it was seeking to amend the contract in light
of "significant differences in the analysis" of the financial
results of Mediaset's pay-TV unit, Mediaset Premium.
Mediaset's board rejected the changes proposed by Vivendi in
July, and threatened legal action should Vivendi fail to respect
the accord.
In a statement on Tuesday, Fininvest said that it is seeking
compensation for damages it suffered, which include an "undeniable
harm" to the company's image and a decrease in the value of
Mediaset's shares following Vivendi's proposal to change the terms
of the signed contract.
Further damage comes as Mediaset shares' value would have
increased had the contract been executed, Fininvest added.
The announcement comes few days after Mediaset itself said it is
seeking a separate compensation estimated at EUR50 million a month
starting from July 25 for damages stemming from a delay in
executing the contract.
The broadcaster said the legal action doesn't include the
overall damages the Italian company would suffer if Vivendi fails
to respect the accord. Mediaset says the overall damages would top
EUR1.5 billion.
Fininvest, which holds a 33.5% stake in Mediaset, previously
accused Vivendi of attempting to build "an extremely large stake in
Mediaset in an underhanded and unacceptable way."
Vivendi, which is run by French billionaire Vincent Bolloré,
rejected accusations adding that the April agreement was based on a
business plan "that proved to be wildly optimistic or even totally
unworkable."
Write to Manuela Mesco at manuela.mesco@wsj.com
(END) Dow Jones Newswires
August 23, 2016 13:12 ET (17:12 GMT)
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