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Europe says Vivendi can help itself to Telecom Italia if it wants

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The European Commission has said it’s got no problem with Vivendi acquiring ‘de facto control’ over Telecom Italia so long as the latter flogs its stake in a services group.

Vivendi has been stalking Telecom Italia for ages, recently using its 24% stake in the company to appoint the majority if the board thus, essentially, giving it control of the whole company without having to fork out any more cash. It has also been amassing a significant minority stake in Italian broadcaster Mediaset, leading the Italian regulator to recently express its concerns.

It is this media angle, rather than a straight telecoms one, that had concerned the European Commission, prompting it to look into the matter of Vivendi’s control of Telecom Italia a couple of months ago.

“The Commission found that, post-transaction, Vivendi would have had an incentive to raise prices charged to TV channels in the market for wholesale access to digital terrestrial television networks, where Persidera and Mediaset each hold a significant share,” said the announcement. “The benefits of such a strategy would be obtained either directly through Persidera or indirectly via the minority shareholding in Mediaset, since other players active in the market do not represent a viable alternative for TV channels. As a result, TV channels would have found it more expensive to reach their audiences in Italy.”

Vivendi has agreed to those terms, but there is no mention of any further measures Vivendi might be taking to cement its control of Telecom Italia. The tone of the announcement indicates an ambition to own the majority of the shares but there have been no formal announcements of such a move from Vivendi that we’re aware of.


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