Vivendi offers $3 billion to Jewish GVT, based in Curitiba. The bid values GVT at 5.4 billion reais, Vivendi said yesterday.
Vivendi Offers $3 Billion for Brazilian Company GVT (Update1)
Share | Email | Print | A A A
By Heloiza Canassa and Flavia Bohone
Sept. 9 (Bloomberg) -- Vivendi SA plans to buy Brazilian telecommunications provider GVT (Holding) SA for about $3 billion and said the largest shareholders agreed to support the takeover.
Vivendi, the Paris-based owner of Universal Music Group, will offer 42 Brazilian reais ($22.96) a share for GVT, according to a statement. The bid values GVT, based in Curitiba, Brazil, at 5.4 billion reais, Vivendi said yesterday.
The deal will help Vivendi, led by management-board Chairman Jean-Bernard Levy, expand in a growing South American market. Levy, a former engineer with France’s telecommunications ministry, said this month that the company was on the lookout for acquisitions, especially in developing countries.
“There are only a few opportunities to enter Latin America at the moment,” Alexandre Garcia, an analyst with Raymond James & Associates, said in a telephone interview from Sao Paulo. “For a company that lacks growth prospects, an asset such as GVT is very valuable.”
Vivendi signed an agreement with GVT’s controlling shareholders Swarth Group and Global Village Telecom (Holland) BV, enabling it to make the “amicable tender offer,” the company said.
GVT is seeking to remove so-called poison pill provisions at GVT that would require a higher offer price.
“There will still be discussion about the offered price because of the poison pills,” Garcia said.
One of the poison pills requires that any acceptable offer be at least 25 percent more than the highest price of the stock in the past 52 weeks. That equivalent would be to 47.49 reais.
Poison Pills
Vivendi fell 5 cents to 20.02 euros yesterday in Paris trading. The shares have lost 14 percent this year. GVT Holding rose 1.66 reais to 36.26 reais in Sao Paulo and has gained 43 percent this year.
A spokesman for GVT had no immediate comment yesterday, a holiday in Curitiba. The company provides long-distance phone service, Internet and voice-over-Internet in west-central, southern and northern Brazil.
GVT said in a regulatory filing yesterday that shareholders Global Village Telecom (Holland) BV, Swarth Investments LLC and Swarth Investments Holding LLC canceled a plan to sell shares. On Sept. 1, GVT said shareholders would sell as many as 24 million shares in a secondary offer.
Levy has boosted earnings at Vivendi’s Moroccan phone business, Maroc Telecom, and at pay-TV unit Canal Plus with takeovers the past two years. He kept Vivendi’s phone, pay- television and music units together while competitors such as Viacom Inc.’s Sumner Redstone broke up assets.
To contact the reporters on this story: Heloiza Canassa in Sao Paulo at hcanassa@bloomberg.net; Flavia Bohone in Sao Paulo at fbohone@bloomberg.net |
