US satellite broadcaster DirecTV has confirmed it is considering bidding for Vivendi’s Brazilian fixed-line and broadband unit GVT.
SatelliteFinance understands that Vivendi, a media conglomerate based in France, is looking to sell the asset for a…
US satellite broadcaster DirecTV has confirmed it is considering bidding for Vivendi’s Brazilian fixed-line and broadband unit GVT.
SatelliteFinance understands that Vivendi, a media conglomerate based in France, is looking to sell the asset for a minimum €7bn (US$8.9bn).
Speaking on a conference call yesterday, DirecTV CEO Michael White said his group was looking over GVT’s books and was in the early stages of a potential offer.
“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],” said White.
“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, explained Ovum analyst Jonathan Doran.
“This would be a significant departure [for DirecTV in Brazil] as it has only engaged in marketing alliances with telcos before rather than direct ownership or JVs,” he added.
However, during the conference call yesterday, 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. It has roughly 400,000 pay-TV customers.
Telcos America Movil, Oi, and Telecom Italia are also reportedly mulling bids for the unit, as well as investment funds.
According to the Ovum analyst, previous attempts to offer triple play services through marketing alliances had been of limited success, 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.
Vivendi, which first bought a stake in GVT in 2009, is seeking to address its debts, which stood at €14.1bn at the end of Q2, and scale back its business. It has charged Deutsche Bank and Rothschild to sound out potential buyers for GVT in the summer.
The French conglomerate is refocusing its business as it weathers Europe’s sovereign debt crisis. It is looking to concentrate on the media side of its operations and on creating content. Besides GVT, Vivendi is also considering disposing other telecoms assets, such as Maroc Telecom and SFR.
