Vivendi confirmed the planned merger between its subsidiary SFR and the Louis Dreyfus group relating to the potential sale of the latter’s stake in Neuf Cegetel.
SFR is the second-largest mobile phone operator in France. Neuf Cegetel is the second largest broadband operator in France.
Commenting on the transaction, Jean-Bernard Lévy, Chairman of Vivendi’s Management Board, stated: “This investment is a very attractive opportunity for Vivendi to strengthen its position and development in one of its main business sectors. The planned agreement would make it possible to merge two companies with increasingly complementary and healthy businesses and would create value for Vivendi shareholders.”
SFR would finance this transaction through debt, notably with Vivendi granting a loan under market terms. To repay this loan, SFR has agreed to considerably reduce dividend payments that it would receive in the three next financial years.
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