Vivendi examines four bids for GVT
29 November 2012 |
Vivendi is reportedly examining four non binding offers of over €6 billion for Brazilian telco GVT.
UPDATE: Liberty Global has released a statement denying it has entered a bid for GVT. "As a matter of policy, we do not comment on M&A rumours, but we can confirm that we did not table a bid for GVT," a Liberty spokesperson told Reuters.
The media group received preliminary bids from satellite group DirecTV, América Móvil, a group of private equity funds and cable group Liberty Global, sources told Reuters.
Several private equity firms, including Providence Equity Partners and Apax Partners have explored bids for GVT, according to a Reuters source, but only one had been retained for the second round of bidding.
Vivendi received more non-binding offers but has retained the three groups mentioned above, and one of the private equity companies to go on to the next stage of bidding, a source told Reuters. Final bids are expected by early January.
Telecom Italia may also take part in the bidding process following a board meeting on December 6 2012 to discuss GVT and the spinoff of its Italian fixed network.
The Italian telco has been heavily linked with GVT since Egyptian Tycoon Naguib Sawiris made an investment offer earlier this month.
Vivendi is looking to raise at least €7 billion from the sale, although none of the preliminary bids were reportedly over this threshold.
The price tag is more than twice the €3 billion it paid for the telco, an alternative provider of fixed telephone, internet and TV services in 120 Brazilian cities, in 2009.
The GVT sale is part of Vivendi’s strategy to cut its debt and boost its share price through asset sales and a renewed focus on its media business.
Vivendi is also in the process of selling its stake in Moroccan operator Maroc Telecom and considering merger options for its French operator SFR.
"Vivendi is confident that they'll sell GVT before Maroc Telecom, in the first quarter of 2013,” one of the sources told Reuters. "They have four bids and consider two of them serious."
At the €7 billion price tag GVT would be valued at 8.1 its 2013 estimated EBITDA, which is ambitious given the average for telco sales of 5.1 times in the European sector and four times in Brazil, according to Espirito Santo Investment Bank.