Mediaset shareholders back restructure rules change

Mediaset has won approval from shareholders to proceed with a major European restructure, despite a failed last-minute legal bid from Vivendi to block the Media For Europe project.

Last year, the Italian broadcaster announced plans to merge its Italian and Spanish units into one new holding company, called Media For Europe, that will be based in Amsterdam.

At a shareholders meeting on Friday, Mediaset won backing for governance tweaks needed to smooth over the restructure, despite opposition from French broadcaster Vivendi, which is Mediaset’s second biggest shareholder.

According to a report in the New York Times, Vivendi launched a last-minute legal bid to suspend a ruling that forced it to freeze two-thirds of its stake in Mediaset, but the court rejected the motion.

In 2017, an Italian regulator ruled that Vivendi’s holdings in Mediaset and Telecom Italia broke competition rules, leading the French firm to hive off two-thirds of its stake in the former into a holding company.

That holding company, Simon Fiduciaria, was subsequently barred from voting on Mediaset’s restructure plans, meaning its biggest shareholder Finninvest – which is owned by the Berlusconi family – could force through its restructuring plans with minimal opposition.

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 Friday’s shareholder meeting with a view to approving changes to the bylaws of MFE suggested by the court.

It is facing a March deadline to push through its plans, which Mediaset claims will allow it to pursue tie-ups in Europe to better compete against the growing OTT threat from the likes of Netflix.

Doubts over the future of Mediaset’s pan-European plan had increased after Mediaset and Vivendi failed to resolve their multiple legal disputes, including the one over MFE, with an out-of-the court agreement.

In a statement, Vivendi said it “deplores… the irregular approval by the Mediaset Extraordinary Shareholders Meeting of the new merger plan regarding MediaForEurope”.

It accused Mediaset of “ignoring Italian law procedures regarding trans-border mergers” and said the vote had “merely removed some blatantly abusive clauses, without modifying the disproportionate rights granted to Finninvest”.

The dispute between the two firms goes beyond the restructuring, however, stemming from Vivendi’s decision to withdraw from a pay-TV deal in 2016. Mediaset claims Vivendi manipulated the Italian firm’s share price by pulling out of the deal, something that Vivendi disputes.