PARIS, March 20 Vivendi SA is
considering splitting off its biggest unit, French mobile
telecoms operator SFR, and putting a chunk of the group's debt
into the subsidiary, Bloomberg reported on Wednesday.
Shares in Vivendi closed up 4.4 percent at 16.22 euros
following the report, which said no final decision had been made
and Vivendi could still opt for an alternative strategy.
A company spokesman declined to comment on the report.
"Vivendi is interested in maximising value for SFR and at this
stage any other speculation would be very premature," he said.
Two banking sources close to the matter had told Reuters
earlier this week that talks on the future of SFR were on
Vivendi has been in the midst of a portfolio review and
strategy revamp, saying it wants to reduce exposure to
capital-intensive, mature telecoms businesses to focus more on
its media activities in music and pay-TV.
But it has already unsuccessfully tried to sell its
Brazilian telecom unit, GVT, and its 61 percent stake in
videogame business Activision Blizzard. It is still
working on the sale of its 53 percent stake in Maroc Telecom
The question of what to do with SFR, which accounts for
about 40 percent of Vivendi's group sales, is more complicated.
There are no obvious strategic buyers for the asset, and a
merger with another French mobile operator has essentially been
ruled out for now by competition regulators.
France's telecom market is also in the throes of a price war
sparked by new mobile player Iliad, which has pushed
valuations lower and complicated any possible deal-making.
A spin-off of SFR would mark a reversal of strategy for
Vivendi, which in April 2011 bought out SFR's co-owner, Vodafone
, paying 7.95 billion euros for the UK company's 44
Vivendi has in the past held talks with French cable
operator Numericable over a tie-up with SFR but they foundered
over valuation issues and deal structure, sources earlier told
Reuters. SFR is also eyeing options for network sharing deals to
reduce capital expenditures including with Bouygues Telecom
The group is expected to give an update on its strategy at
its annual shareholders' meeting on April 30.