Vivendi Says Court Allows It to Vote on Mediaset Merger Plan

(Bloomberg) -- Vivendi SA said a Milan court ruled it can vote with other Mediaset SpA shareholders on a plan to merge the broadcaster’s Italian and Spanish businesses, raising a potential hurdle to the deal.

Vivendi, Mediaset’s second-biggest shareholder, opposes the project to combine the businesses into a Dutch holding company known as Media for Europe and Mediaset’s board had sought to exclude Vivendi from the vote on Sept. 4.

Mediaset’s controlling Berlusconi family sees the Dutch move as a first step toward a wider alliance of European broadcasters that would help it face up to the growing challenge from streaming giant Netflix Inc. Vivendi sees it as an attempt by the Berlusconis to cement their control over Mediaset and vowed on Saturday to vote against the move.

“The group came to this decision after having assessed the rights, or lack thereof, that minority shareholders, Vivendi in particular, would have under the proposed MFE bylaws,” Vivendi said in a statement in response to the court ruling.

It may still be hard for Vivendi to block the merger as most of its 28.8% stake sits in an independent trust. That’s left the French company able to vote using only the remaining stock that it controls directly, which equates to 9.99% of the voting rights.

Mediaset welcomed the court ruling, saying in a statement that it meant Vivendi won’t be able to exercise the shares held in the trust. That would leave it far short of the votes it needs unless it can convince other shareholders to join the revolt.

A Vivendi spokesman disputed Mediaset’s interpretation of the ruling, saying Vivendi would lodge a complaint with the court if Mediaset prevents the votes held by the trust being exercised.

“Mediaset is attempting to impede and spoil basic shareholder rights in order to illegally seize control,” the spokesman said.

--With assistance from Tommaso Ebhardt and John Follain.

To contact the reporter on this story: Angelina Rascouet in Paris at arascouet1@bloomberg.net

To contact the editors responsible for this story: Thomas Pfeiffer at tpfeiffer3@bloomberg.net, James Amott

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