January 10, 2020 / 7:03 AM / 6 months ago

Mediaset seeks shareholder approval to ease pan-European plan

    By Elvira Pollina
    MILAN, Jan 10 (Reuters) - Italy's biggest commercial
broadcaster Mediaset has called a shareholder meeting on
Friday over governance tweaks needed to ease a pan-European
expansion plan which its second-largest investor Vivendi
 is fighting in court. 
    Controlled by the family of former Italian Prime Minister
Silvio Berlusconi, Mediaset last year approved a plan to
merge its businesses in Italy and Spain under a
Dutch-based company, called MediaForEurope (MFE).
    The broadcaster wants to use the new entity to pursue
tie-ups with European peers to take on competition from
streaming apps such as Netflix and web giants like
    But French media group Vivendi, led by billionaire Vincent
Bollore, opposes the plan saying the governance structure of the
new entity would strengthen Berlusconi's grip on the company.
    In response to Vivendi's legal challenge, a Spanish court
has provisionally put the merger on hold, while a decision by a
Milan court over the French group's request to suspend the deal
is still pending. 
    To increase the chances the Milan judge will rule in its
favour, Mediaset called an extraordinary shareholder meeting for
Jan. 10 to approve changes to the bylaws of MFE suggested by the
    Vivendi however said in a letter to Mediaset's board last
month that the proposed changes failed to address its concerns
and called for a broader overhaul.   

    NO TRUCE    
    Doubts over the future Mediaset's pan-European plan
increased after Mediaset and Vivendi failed to resolve their
multiple legal disputes, including the one over MFE, with an
out-of-the court agreement.
    Vivendi and Mediaset have been at odds since the French
conglomerate withdrew from a deal to buy Mediaset's pay-TV unit
and then built up a 29% stake in the group, which the Italian
broadcaster considers hostile.  
    Two thirds of that stake is held in a trust following a
ruling by the Italian telecoms watchdog over Vivendi's excessive
presence in the country's media and telecoms sectors given its
24% stake in Telecom Italia
    The Berlusconi family's holding company, Fininvest, holds
45.8% of Mediaset's voting rights, meaning it will almost
certainly get its way on Friday, despite Vivendi's opposition 
if it bars the trust from voting as it has done in the past.
    Mediaset's board will take a decision on whether to exclude
the trust ahead of the shareholder meeting.
    The deadlock with Vivendi is weighing on Mediaset shares,
which fell 5.5% in 2019 against a 27% rise in Italy's mid-cap

 (Reporting by Elvira Pollina. Editing by Jane Merriman)
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