A group of private equity firms, including KKR & Co LP (NYSE:KKR) and Apax Partners LLP, intends to make a joint bid of as much as USD5bn (EUR3.7bn) for Brazilian telecommunications company Global Village Telecom (Holding) SA, or GVT, a unit of French Vivendi SA (EPA:VIV), Bloomberg said today citing knowledgeable sources.
Other participants in the group are Gavea Investimentos Ltda, owned by JP Morgan Chase & Co (NYSE:JPM), and Cambuhy Investimentos Ltda. Brazilian investment bank BTG Pactual Group is still mulling over the possibility of taking part in the bid, the sources said. Valor Economico had reported previously, without citing sources, that BTG Pactual had pulled out of the race.
Their rival in the competition is US satellite-television provider DirecTV (NASDAQ:DTV), which is expected to propose a price closer to the asking price of USD8bn, due to the synergies that a possible deal could create. According to one of the sources, potential bidders are getting ready for the second round of the auction, which is seen to be completed by the end of next month.
Representatives for Vivendi, Apax, KKR, BTG Pactual and JP Morgan refused to comment. DirecTV did not immediately respond to Bloomberg’s message asking for a comment, whereas Cambuhy Investimentos did not answer the agency’s calls.
Vivendi put GVT up for sale in 2012 after buying it for EUR3bn (USD4.1bn) in 2009.
French media group Vivendi SA (EPA:VIV) is reportedly looking at the possibility of divesting its holding in Morocco-based telecom company Maroc Telecom (EPA:IAM), the Financial Times said on Monday, citing sources in the know.
The French company has started talks with bankers from Lazard Ltd (NYSE:LAZ) and Credit Agricole SA (EPA:ACA) with a view to appointing them as advisors for the proposed divestment. The sale of the 53% stake could result in EUR4bn (USD5.2bn) in proceeds for Vivendi, the sources said. The sale of the business is expected to spark the interest of regional operators such as Emirates Telecommunications (Etisalat) and Qatar Telecom (Qtel).
The disposal follows a review of Vivendi’s structure that was prompted by a notable slump in its stock price earlier in 2012 and the departure of CEO Jean-Bernard Levy over strategy disputes with management board members.
Maroc Telecom, Morocco’s top telecom operator, is the second-largest contributor to Vivendi’s earnings. The division keeps expanding its operations overseas, while its domestic business recently encountered difficulties brought on by the market’s increasing maturity.
Vivendi has meanwhile hired Deutsche Bank (ETR:DBK) and Rothschild to help with the sale of another telecom unit, Brazilian landline operator GVT. The French company’s music division Universal Music Group Inc (UMG) bought EMI Group’s recorded music division in late September, meaning that the structure overhaul will not affect this business, despite the pending sale of its Parlophone label under the requirements of the European Commission.