Vivendi Shares Jump Most on Record on Universal Listing Plans
Vivendi Shares Jump Most on Record on Universal IPO Plans
(Bloomberg) -- Vivendi SA rose the most on record after the company said it may spin off its profitable Universal Music Group by the end of the year.
The Paris-based company’s shares climbed as much as 24%, the biggest-ever one-day gain since they were listed in 1989. Shares in Bollore SA, the majority holder of Vivendi, jumped as much as 18%.
The company had planned to list the division by early 2023. The announcement on Saturday of the earlier timing follows the completion of the sale of a 10% stake to a consortium led by Tencent Holdings Ltd. that valued the world’s biggest music company at 30 billion euros ($36.4 billion). The Tencent-led group now owns 20% of the unit.
Vivendi also said that it would consider distributing 60% of UMG’s share capital to its shareholders.
Universal Music has been raking in money from the surging popularity of music streaming that has dragged the industry out of a decade-long slump. That success has limited the blow to the French media group from a drop in advertising and publishing revenue.
A stock market presence could give UMG more financial clout to compete with rivals Warner Music Group Corp. and Sony Music Entertainment. It may also narrow the discount some investors believe is applied to Vivendi shares because of its holding structure.
Shareholders will be asked to approve the plan at a meeting on March 29, Vivendi said, adding that the Tencent-led group favored going public.
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