French media conglomerate wins over competition watchdog by agreeing to sell Persidera unit.
ivendi on Tuesday won the European Commission’s conditional approval to assume de facto control of Telecom Italia.
In return for the green light, the French media conglomerate has agreed to sell Telecom Italia’s broadcasting services arm, Persidera, easing concerns about Vivendi’s ability and incentive to raise prices charged to TV channels for access to digital TV broadcast networks.
"The benefits of such a strategy would be obtained either directly through Persidera or indirectly through the (Vivendi’s) minority shareholding in [Italian media company] Mediaset, since other players active in the market do not represent a viable alternative for TV channels," explained the European Commission, in a statement.
By selling Persidera, Vivendi’s position in Telecom Italia no longer represents a competitive threat, the Commission said.
Vivendi, which is Telecom Italia’s biggest single stakeholder with a stake of 23.94%, recently gained control of two-thirds of the operator’s board at a shareholder vote in early May.
In anticipation of that happening, Vivendi informed the Commission that such an occurrence would give it de facto control over the Italian incumbent; it submitted concessions in a bid to head off any antitrust concerns.
A Reuters report in mid-May claimed that Vivendi’s proposed remedies included selling Persidera.
While Vivendi may have scored a victory with the EC, Tuesday’s decision has no bearing on its ongoing dispute with Italian telco regulator, L’Autorità per le Garanzie nelle Comunicazioni (AGCOM).
The watchdog in April ordered Vivendi to pare down its stake in either Telecom Italia, or Mediaset –in which Vivendi holds almost 29%. In order to safeguard media pluralism, competition law in Italy prevents single entities wielding influence in both telcos and media companies.
Vivendi claims that it does not exercise a dominant influence over Mediaset, and plans to challenge AGCOM’s order.
"Today’s conditional clearance decision is without prejudice to the Italian media plurality review process," the Commission said.