Telefonica to offer Vivendi a TV content deal in GVT bid: source
MADRID (Reuters) - Telefonica will offer Vivendi a television content-sharing deal alongside its bid for Vivendi's Brazilian broadband telecoms business GVT, taking its overall offer to around 7 billion euros ($9.4 billion), a source said on Monday.
The Spanish company launched a 6.7 billion euro cash-and- shares bid for GVT earlier this month but is facing a possible challenge from Telecom Italia, which has said it is considering making a counter offer.
Telecom Italia is preparing to offer up to 7 billion euros ($9.4 billion) to outbid Telefonica, Bloomberg reported on Sunday, citing people with knowledge of the plan.
"This hasn't been made public yet but Telefonica's offer is worth more than the 6.7 billion euros currently on the table because it includes a television content deal with Vivendi," a source with knowledge of the matter told Reuters.
The audiovisual business is strategic for both Vivendi - market leader in France - and Telefonica, which has increased pay-TV subscribers in Spain over the past few months and launched a bid for its domestic rival DTS.
"Telefonica's presence in the pay-TV market (vs. Telecom Italia) increases the appeal of a possible content agreement," Banco Sabadell said in a note to clients.
"We would not rule out Telefonica improving the offer for GVT in order to get hold of the asset, which would complement its fixed business in Brazil and would speed up the consolidation of the Brazilian market," it said.
Telefonica Brasil owns the country's biggest mobile operator, Vivo.
(1 US dollar = 0.7489 euro)