US satellite-broadcaster DirecTV is considering bidding for Vivendi’s Brazilian fixed-line and broadband unit GVT.
Vivendi is looking to sell for a minimum €7bn (US$8.9bn), TelecomFinance was told. According to a newswire report America Movil, Oi,…
US satellite-broadcaster DirecTV is considering bidding for Vivendi’s Brazilian fixed-line and broadband unit GVT.
Vivendi is looking to sell for a minimum €7bn (US$8.9bn), TelecomFinance was told. According to a newswire report America Movil, Oi, and Telecom Italia are all mulling bids. Investment funds have also taken an interest in GVT.
Speaking on a conference call DirecTV’s CEO Michael White said it was in the early stages of a potential offer saying it was looking over GVT’s books.
“If you look at the business, it is a very well-run business, it’s a high-growth business and it’s a very complementary business to our Brazil business [Sky Brasil],” White said.
“It has a pay-TV business. Who knows, there could be synergies as we look at that. And they have a nice broadband offering, which could have synergies to sell a bundle that would be very strategic.”
An acquisition of GVT would enable DirecTV to enter the triple play market offering a bundle of TV, broadband and fixed-line telephone services, Ovum analyst Jonathan Doran commented.
“This would be a significant departure [for DirecTV] as it has only engaged in marketing alliances with telcos before rather than direct ownership or JVs,” he added.
However, DirecTV CEO White was keen to stress that a deal was not imminent and it was still in the process of assessing potential synergies.
Vivendi refused to comment on White’s remarks.
GVT offers a hybrid of DTH and IPTV services, as well as broadband and fixed-line telephony, and has been growing rapidly. Today it has roughly 400,000 pay-TV customers.
According to Ovum analyst Jonathan Doran the country has nine million pay-TV subscribers, but that figure is set to more than double to 20 million by 2017 due to the country’s burgeoning middle class.
Previous attempts to offer triple play services through marketing alliances had been of limited success, according to Ovum analyst Doran, as they did not allow the operator to offer discounted bundles – an important offering in Brazil as the higher-value consumer segments starts to reach the point of saturation.
GVT is a subsidiary of French conglomerate Vivendi which first bought into the operator in 2009.
Vivendi is now seeking to address its debts, which stood at €14.1bn at the end of Q2, and scale back its business. It charged Deutsche Bank and Rothschild with sounding out potential buyers for GVT in the summer.
Vivendi is refocusing its business as it weathers Europe’s sovereign debt crisis. The conglomerate is looking to concentrate on the media side of its business and on creating content. Besides GVT, Vivendi also considers disposing other telecoms assets such as Maroc Telecom and SFR.
