Vivendi receives Telecom Italia and Telefonica offer for GVT

Vivendi has received two binding offers- Telecom Italia and Telefonica for its wholly-owned subsidiary GVT in Brazil.

The Telecom Italia offer represents a total enterprise value of €7 billion. It includes a part in cash (€1.7 billion), a part in Telecom Italia shares (16 percent of share capital and 21.7 percent of voting rights) and a part in TIM Brasil shares (15 percent). The offer expires on September 10, 2014. The GVT acquisition would be submitted to Telecom Italia’s shareholders meeting and Telecom Italia would have an exit clause in case of a loss of significant value of GVT.

The Telefonica offer, following the offer received last August 4, represents a total enterprise value of €7.450 billion. It includes a part in cash (€4.663 billion) as well as a part in Telefonica Brasil shares (12 percent) of which about one third can be exchanged at Vivendi’s discretion for 5.7 percent of the share capital and 8.3 percent of the voting rights in Telecom Italia. This offer expires on August 29, 2014.

The two financial offers also include proposals for content partnerships.

Telefonica’s offer is considered particularly attractive, generating a capital gain of more than €3 billion. The other conditions of the offer, limiting to a strict minimum the risk of executing the operation as well as Vivendi’s commitments after the sale, are totally in line with Vivendi’s objectives.

The agreement between Telefonica and Vivendi would allow the development of joint projects in ​​content and media. In addition, if it so wish, Vivendi could become a shareholder in Telecom Italia by exchanging its Brazilian shares for Italian ones.

The Vivendi supervisory board, which meets today, will examine the two offers in the best interests of Vivendi shareholders and GVT employees, and will decide what actions to take as a result.

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