Mediaset to Create Dutch Base in Push for European Tie-Ups
Mediaset to Create Dutch Base in Push for European Tie-Ups
(Bloomberg) -- Italian broadcaster Mediaset SpA is combining its Italian and Spanish businesses in a new Dutch holding company, giving it more flexibility to pursue European mergers.
Shareholders of both companies will receive shares in the new entity, to be listed in Milan and Madrid, under the plan approved by Mediaset’s board on Friday, the company said in a statement.
The change is “aimed at creating a pan-European media and entertainment group, with a leading position in its local markets and greater scale to compete and potential to expand further in specific countries across Europe,” Mediaset said in the statement.
Bloomberg News reported earlier that Mediaset was exploring options for the Spanish unit, including a possible combination. Mediaset shares rose 3% in Milan on Friday, while Mediaset Espana Comunicacion SA rose as much as 9.7% before the stock was suspended by regulators.
The Italian company, controlled by the family of billionaire former Prime Minister Silvio Berlusconi, has been pushing for mergers in Europe as the rampant growth of Netflix Inc. and other on-demand video platforms wreaks turmoil on traditional broadcasters. A planned pay-TV alliance with French media group Vivendi SA collapsed in 2016.
The takeover of Europe’s biggest satellite-TV company, Sky, by Comcast Corp. and of Rupert Murdoch’s entertainment assets by Walt Disney Co. have further skewed the media industry toward massive companies with global reach.
Shares in Mediaset have fallen 4.2% in Milan this year, giving it a market value of 3.2 billion euros ($3.6 billion). The company bought a 9.6% stake in Germany’s ProSiebenSat.1 Media SE last week, a move that Chief Executive Officer Pier Silvio Berlusconi called a “friendly acquisition” to create an “increasingly international outlook.”
Dutch Enticements
Mediaset said it will pay out dividends of 100 million euros as part of the reorganization and buy back shares worth up to 280 million euros. It expects the new structure to bring cost efficiencies and savings of between 100 million euros and 110 million euros by 2023. Mediaset will transfer the ProSieben stake to the Dutch holding company.
While Mediaset’s operational base is set to remain in Italy and it will continue to pay taxes there, the Dutch move will be seen back home as another powerful Italian family distancing its business interests from the country’s stagnating economy and turbulent politics.
The Agnelli family shifted away from Italy in the past decade to register its businesses in the Netherlands. The move cemented the Agnellis’ control over their empire: The family has 29% of shares in global carmaker Fiat Chrysler, and Dutch law gives it 42% of the voting rights.
The Netherlands offers plenty of enticements for companies to locate there -- less bureaucracy and the availability of poison pill structures that discourage hostile takeovers. Businesses formed from cross-border mergers such as Airbus SE and Fiat Chrysler Automobiles NV have set up bases there.
To contact the reporters on this story: Daniele Lepido in Milan at dlepido1@bloomberg.net;Manuel Baigorri in Hong Kong at mbaigorri@bloomberg.net
To contact the editors responsible for this story: Rebecca Penty at rpenty@bloomberg.net, Thomas Pfeiffer, Tommaso Ebhardt
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