Vivendi’s shares fell more than 4 per cent on Wednesday, a day after the media group lost the broadcast rights to France’s Ligue 1 football matches for the first time since 1984.
The loss of the rights for the 2020-2024 season of the country’s premier football competition come at a sensitive time for Vivendi and Yannick Bolloré, chairman of its supervisory board who only took over the role from his father Vincent in April.
That was shortly before the elder Mr Bolloré, Vivendi’s largest shareholder, was placed under formal investigation related to the alleged bribery of foreign officials in Africa. He denies any wrongdoing.
Meanwhile Vivendi is also facing challenges in Italy, where it lost control of the board of Telecom Italia, in which it is the largest shareholder. A majority of investors voted to back an alternative set of directors put forward by Elliott Advisors, the US activist hedge fund.
Canal Plus was beaten by Mediapro, a Spanish TV production group majority-owned by Chinese private equity fund Orient Hontai. The company won the rights to three of the main live packages on offer and intends to launch a dedicated sports channel to broadcast the matches.
beIN, the Qatari sports-network, won the third package while Paris-based Iliad, the telecoms group, obtained the digital rights. Two of the seven packages of rights were not sold.
The auction generated a 60 per cent increase in the value, which have risen to €1.15bn per season.
Maxime Saada, chief executive of Canal Plus, played down the impact of losing the rights, saying the company would not “die for having overpaid sporting rights like most of its competitors”.
Olivier Moral, an analyst at HSBC, said it was a “tricky situation” for Canal Plus, which had “underestimated the ambition of Mediapro”.
Recommended
The company could sublicence its coverage or opt to go without football coverage, he added, which would enable Canal Plus to retain some rights but with a reduced number of broadcast matches.
Not having live football would put it into competition with over-the-top streaming services “with deeper pockets and an ability to push pricing down”, said Mr Moral.
Going without live football coverage and “focusing” on films and TV series would ultimately see Canal Plus’s “customer base erode as French Premier League subscribers depart”.
Vivendi recovered some of their losses to close down 3.6 per cent at €21.43.
Be the first to comment