(BFM Bourse) – The communications and media group presented to the market this Monday the prospects of the encrypted channel, which should normally be listed on the London Stock Exchange next month. Canal+ anticipates moderate growth in its revenues in the medium term.
Vivendi refines its division by four. The media, communications and publishing group will hold a general meeting on December 9 which will lead its shareholders to approve (or reject) its proposed split between four entities. Canal+, Havas and Louis Hachette Group will have to become independent by being listed separately, respectively on the London Stock Exchange, Amsterdam and Paris (on Euronext Growth). Vivendi, for its part, would remain involved and continue to manage its stakes in the video game group Gameloft and the record company Universal Music Group.
In the event that this split into four is approved by the shareholders, Canal+, Havas and Louis Hachette would be listed on December 16 on their respective financial markets.
Ahead of this meeting, Canal+ and Havas each organize days dedicated to investors, that is to say a meeting which should allow companies to present themselves in their best light to the market.
Canal+ is holding one this Monday and Havas will follow suit on Tuesday. The encrypted channel has, with this in mind, given some visibility on its activity to the market.
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A valuation of more than 3 billion euros for Canal+
The audiovisual group has indicated that it expects growth in 2024 “in line with that of 2023” (i.e. around 3% on a comparable basis).
For 2025, Canal+ estimates that “the expected cessation of the broadcast of its free French channel C8 as well as the termination of sublicensing contracts and onerous third-party content contracts in France will negatively affect turnover and are expected to increase than offset organic growth,” the company says.
Beyond 2025, Canal+ expects continued “moderate” annual growth at constant scope, in the medium term. UBS, for its part, expected growth of 2.1% in 2024, 2.1% in 2025 and 2% per year between 2025 and 2028.
The company also expects a “moderate” improvement in its adjusted operating margin in the medium term, still at constant scope. To do this, the company will endeavor in particular to “optimize” costs.
Finally, operational cash flows (CFFO) should, according to Canal+, return “in 2025 to a level similar to that of 2023 (398 million euros, Editor's note)”, after an “exceptionally low level in 2024”. Vivendi explains that Canal+ was penalized “by the effects of working capital requirements in the second half of 2024 due to an exceptional concentration of payments linked to the renewal and signing of content contracts, as well as possible non-recurring payments linked to proposals for tax adjustments.
To see if these indications will encourage investors to position themselves on Canal+. For the moment UBS values the encrypted chain at 3.1 billion euros and recommends buying Vivendi shares.
Furthermore, while Havas will hold its investor day on Tuesday, Vivendi recalled its medium-term outlook on Monday. The communications group anticipates an evolution of its revenues of between -1% and 0% in 2024 on a comparable basis, before a rebound of more than 2% in 2025. Its adjusted operating profit is expected at more than 330 million euros in 2024 and should then represent between 12.5% and 13.5% of revenues in 2025. Havas also intends to propose a dividend representing approximately 40% of the net profit of fiscal year 2024 in 2025.
Listing places discussed
On the Paris Stock Exchange, this entire communication was received lukewarmly by the market, with Vivendi shares falling 1.3% around 11:10 a.m.
Remember that Vivendi's goal, by splitting into four, is to reduce the conglomerate discount, that is to say the (negative) difference between its market value and that of the sum of all its assets. . At the end of 2023, before the group announced its split plan, this discount represented 45%, according to Barclays.
By listing Canal+, Havas and Louis Hachette separately, Vivendi intends to obtain more generous valuation multiples for each entity and therefore create value for its shareholders, first and foremost the Bolloré group. Vivendi succeeded very well in 2021 by listing Universal Music Group in Amsterdam. The record company is now worth 42 billion euros on the stock market.
The decisions to list Canal+ in London and Havas in Amsterdam may, however, have raised some eyebrows. For Canal+, the choice of London should allow it to reflect its international dimension, while the company is currently in the process of buying the South African group Multichoice for more than 2.5 billion euros. As for Havas and Amsterdam, it is a question of benefiting from the flexibility of Dutch law by creating a foundation which must “preserve the independence” of the communications company.
The Ciam investment fund, known for highlighting governance flaws and operations that are too meager for minority interests for its taste, has, for its part, contacted the Financial Markets Authority (AMF) to contest this operation.
The fund argued that, for Canal+ as well as Havas and Louis Hachette Group, the choice of listing venue has only one goal: to deviate from the rules which, on the regulated market, require launching a public offer. purchase order (OPA) if a shareholder crosses the 30% threshold. Remember that the Bolloré group currently owns just under 30% of Vivendi.
“The proposed partial split of Vivendi into three entities listed on three places less respectful of the rights of minority shareholders would allow the controlling shareholder to empty Vivendi of its essential assets while strengthening its control over Canal+, Havas and Louis Hachette Group without having to launch a public offer It would thus deprive minority shareholders of the protective provisions of French stock market law,” Ciam argued in a press release. The fund therefore requests that the three companies be listed on the French regulated market.
Questioned by BFM Bourse, Vivendi recalled that it was not commenting on Ciam's accusations.
“By planning to list Canal Plus and Havas on stock exchanges outside France, in London and Amsterdam respectively, Bolloré is circumventing both the control of the AMF and the evaluation of its strategy by a wider market,” he said. for its part judged the Alphavalue design office in a recent note.
Julien Marion – ©2024 BFM Bourse
