Vivendi will buy the close to half of SFR – which it doesn’t hold already – from Vodafone, according to media reports.
Vivendi, a media and telecommunications company, will pay Euros 7.95 billion (about $11.31 billion) for the 44 percent stake in SFR (Societe Francaise du Radiotelephone SA), according to a report in The Wall Street Journal.
The deal needs to be approved by the government’s Competition Authority. The purchase is expected to be finished by the end of June.
In a Vivendi company statement, Jean-Bernard Levy, chairman and CEO said, "We are very pleased to reach our strategic objective to own 100 percent of SFR, which will help Vivendi to focus further on profitable growth and innovation.”
“I am very confident that this will greatly benefit both the Group fs industrial development and our millions of subscribers and consumers globally. The transaction will create a significant increase in Vivendi fs adjusted net income, enabling us to raise the dividend to our shareholders," Levy added.
The Wall Street Journal reports that Vivendi has been trying to gain full control of SFR for several months. SFR is a cellphone and Internet-service provider. SFR has been ranked as France's No. 2 telecom based on revenue, according to The Journal.
The Journal says that by gaining full control of the company, Vivendi may be able to pay larger dividends and it could lead to SFR being more cooperative with Vivendi’s other business units.
Vivendi’s units include video games, music, alternative telecoms, telecoms and Pay TV.
Vivendi operates in 77 countries and has about 51,300 employees.
Vodafone, under CEO Vittorio Colao, has been trying to streamline the company’s portfolio, The Journal said. For example, Vodafone recently sold a 3.2 percent stake in China Mobile Ltd. for $6.93 billion, The Journal added.
Vodafone is a UK-based provider of mobile telecom services, according to TechZone360.
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