Vivendi on Friday revealed it would like to receive €7 billion ($8.9 billion) for its Brazilian-based wireline unit Global Village Telecom (GVT).
According to a Reuters report citing two unnamed sources close to the situation, four companies may be interested in purchasing GVT.
Among the rumored suitors are Brazilian owned Oi SA, America Movil (NYSE: AMX), DirecTV (Nasdaq: DTV) and Telecom Italia, all of which have held discussions about GVT. In addition, a number of investment funds have cited interest in GVT. Interestingly, one service provider that is not taking part in the process is Spain's Telefonica (NYSE: TEF), which made a rival bid for GVT in 2009.
News of a potential sale should not be surprising, however. In August, Vivendi appointed Rothschild and Deutsche Bank to advise it on what options it should consider for GVT. Two of the reasons why it initiated talk about selling the unit were to help stem the bleeding of a 29 percent decline in its share price and to draw more attention back to its core media business.
"Synergies between GVT and other Vivendi units were not as strong as the company first imagined," one of the sources told Reuters. "But that doesn't mean that Vivendi will go on a New Year's sale mode and sell off GVT at any price. There is no way that will happen."
While Vivendi, Oi and America Movil would not comment, Mike White, DirecTV's CEO, said on Tuesday that the satellite provider was in the early stages of evaluating an acquisition proposal for GVT. In September, a Bloomberg report citing two unnamed sources said the provider thinks that purchasing GVT could help expand its Latin American presence.
- Reuters has this article
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