The board of French media giant Vivendi has approved a plan to spin off the mobile operator arm, SFR, which is the country’s second largest cellco.
This will leave the main company more focused on its core media and content businesses and shield it from the price war which has been engulfing French mobile carriers since the debut of disruptive fourth player, Free Mobile, part of the Iliad broadband group. However, it reflects the failure of previous plans to sell SFR, once former joint venture partner Vodafone exited the business.
In a statement, Vivendi said the demerger plan would offer SFR ‘greater strategic autonomy to seize opportunities in a transforming market, reflecting the growing number of services and high speed broadband access in an environment with a huge increase in usage’.
The idea must now be submitted to works councils and regulatory authorities, and after that process, it will make the full details public. The aim is to include the spin-off on the agenda of the next annual shareholders’ meeting at the end of June 2014.
Vivendi has been steadily offloading non-core assets, particularly in telecoms. It has already agreed the sale of its 53% stake in Maroc Telecom to Etisalat for €4.2bn ($5.65bn) and has announced the sale of its controlling stake in video games maker Activision Blizzard.
The group’s supervisory board also confirmed Vincent Bollor’ as its new chairman, replacing Jean-Rene Fourtou. The new chairman will be running a more specifically media-focused organization. Its three main elements are Universal Music Group; Brazilian telecoms and media group GVT; and French pay-TV provider Canal+, which also operates in French-speaking countries in Africa as well as Poland and Vietnam, and has a subsidiary called StudioCanal.