Bouygues, RTL to Merge TF1, M6 to Create New Streaming-Focused Media Operator -- Update
--A merger between TF1 and M6 would create a French streaming
operator in a transforming TV market, the companies say
--Bouygues would have exclusive control over the new entity,
with Bertelsmann's RTL a strategic stakeholder
--Synergies of up to EUR350 million annually are envisaged
within three years of the proposed merger
By Joshua Kirby
French TV networks Television Francaise 1 SA and M6-Metropole
Television SA are planning a merger that will create a
streaming-focused French operator, the two companies and their
respective majority shareholders said in a joint release late
The companies have entered into exclusive talks over a merger
between TF1, 43.7% of which is held by telecommunications company
Bouygues SA, and M6, which is part of Luxembourg-based broadcaster
RTL Group SA. RTL is majority-owned by German media group,
Combining the two networks' brands and expertise would create a
French streaming operator in a market undergoing structural
transformation, the companies said. "The proposed merger is
critical to ensure the long-term independence of French content
creation and to continue to offer diversified and premium local
content to the benefit of all viewers," they added.
The merger would involve a carve out of M6's
non-broadcast-related activities into a new entity, to be called M6
services. The remaining broadcasting entity would be renamed M6
Edition. M6 Services would then be merged with TF1, with RTL
contributing its 48.3% stake in M6 Edition to the merged entity.
The remainder of M6 Edition would stay in free float, in line with
French media regulations, the companies said.
Bouygues would hold 30% of the new group and have exclusive
control over it after buying an 11% stake from RTL for 641 million
euros ($778.9 million), according to the proposed deal. The
transaction would entail a special cash dividend payment of EUR1.50
a share to M6 shareholders.
Around 54% of the new Paris-listed entity would be in free
Bouygues said the new group would have EUR3.4 billion in annual
revenue and an operating profit of EUR461 million, according to pro
forma 2020 results. Within three years, synergies should add some
EUR250 million-EUR350 million to earnings before interest, taxes
and amortization, the companies said.
Bouygues would nominate four members of the entity's 12-person
board and RTL would nominate two. M6 Chairman Nicolas de Tavernost
would be proposed as chairman and chief executive officer of the
new company, which would be given a name "reflecting the diversity
and the strength of its assets," the companies said.
The transaction, which has the approval of the boards of all
involved companies, should go ahead by the end of 2022, pending
employee consultations and antitrust clearance, Bouygues said.
Write to Joshua Kirby at email@example.com;
(END) Dow Jones Newswires
May 18, 2021 03:08 ET (07:08 GMT)
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