Bank: “Vivendi split likely to help crystallise value”
December 15, 2023
By Chris Forrester
French media giant Vivendi is planning to split itself into three separate listed entities. Analysts at investment bank BNP/Paribas have looked closely at the plan. The three businesses are Canal+, ad-agency Havas and a holding company managing the remaining equity stakes in listed and non-listed companies.
The bank says that Vivendi has long traded at a discount to its fair value with investors ascribing a conglomerate discount and questioning its capital allocation policy.
“Splitting the group into three entities is likely to help crystallise value, in our view. We estimate that Vivendi currently trades at a 37 per cent discount to its fair value when excluding a 20 percent conglomerate discount. Management pointed that it is to update the market on this project in due course,” says BNP/Paribas.
“[In the] near-term Vivendi should [rise] on this, but questions will then quickly turn to who wants to own any of the three listed assets medium to longer term: Havas has significantly underperformed Global Ad agencies operationally, while we are more bullish than most next year on Broadcasters that is more to do with their own M&A stories (PSM break-up, ITV bid), than optimism around the shape of the non-digital advertising recovery and the remaining holding-co. should have a similar conglomerate discount,” says the bank.
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