Vivendi, Tencent Enter Talks for 10% Stake in UMG -- Update
August 06 2019 - 3:26AM
Dow Jones News
By Anthony Shevlin
-Vivendi and Tencent enter preliminary talks for a 10% stake in
Universal Music Group.
-Tencent would have a one-year call option to acquire an
additional 10% stake at the same price and terms.
-Vivendi originally said last July it was considering selling up
to 50% of UMG but ruled out an IPO.
Vivendi SA (VIV.FR) said Tuesday that it has entered into
preliminary negotiations with Tencent Holdings Ltd. (0700.HK) for a
10% stake in Universal Music Group.
The French media company said UMG has a preliminary equity
valuation of 30 billion euros ($33.50 billion) on a fully-diluted
basis.
Tencent would have a one-year call option to acquire an
additional 10% stake at the same price and terms.
"Vivendi is keen to explore enhanced cooperation which could
help UMG capture growth opportunities offered by the digitalization
and the opening of new markets," the company said, adding that it
targets value creation for both itself and Tencent via the
partnership.
The transaction is subject to due diligence and Vivendi plans to
continue the process for the sale of an additional minority stake
in UMG to other potential partners.
Vivendi originally said in July last year that it was
considering selling up to 50% of UMG but ruled out an initial
public offering. Back then, the company said the move would likely
be launched in the fall and could be completed within the next 18
months.
In November the company said the process of selling a stake in
UMG was "on track" and expected the deal to be cash only.
Last month Vivendi said its first-half net profit more than
tripled on year, boosted by the growth of its Universal Music Group
business. The company said the process of opening up UMG's share
capital was progressing and several contacts had been established
with potential strategic partners.
Write to Anthony Shevlin at anthony.shevlin@dowjones.com;
@anthony_shevlin
(END) Dow Jones Newswires
August 06, 2019 03:11 ET (07:11 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
Tencent (PK) (USOTC:TCEHY)
Historical Stock Chart
From Aug 2024 to Sep 2024
Tencent (PK) (USOTC:TCEHY)
Historical Stock Chart
From Sep 2023 to Sep 2024