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French conglomerate VIVENDI has announced its plans to spin off and list its television business, CANAL+, on the London Stock Exchange. This move is seen as a positive sign for the City’s financial market, which has shown signs of revival in recent months.
In a statement today, the Paris-based media company explained its decision to list CANAL+ in London, highlighting the international reach of the business. With nearly two-thirds of its subscribers based outside of France and a global distribution network for films and TV series, CANAL+ is strategically positioning itself to attract international investors.
“A London-based listing would represent an attractive solution for international investors likely to be interested in the group,” VIVENDI stated, citing recent growth in African, European, and Asia-Pacific markets.
Corporate Structure and Taxation
Despite the London listing, the spun-off television business will be incorporated and taxed in France. It will not be subject to mandatory stock market regulations in either the United Kingdom or France. Additionally, VIVENDI mentioned the possibility of a secondary listing of CANAL+ shares in Johannesburg.
The decision to spin off CANAL+ is part of a broader restructuring effort by VIVENDI to address what it describes as a “conglomerate discount,” where investors have undervalued the company as a whole. As part of this restructuring:
- HAVAS, VIVENDI’s public relations firm, will be spun off and listed as a Dutch public limited liability company on Euronext in Amsterdam.
- A newly named entity, LOUIS HACHETTE GROUP, will house VIVENDI’s publishing and distribution businesses and list on Euronext Growth in Paris.
- VIVENDI’s listed subsidiary LAGARDÈRE will continue to be listed on the main market of Euronext Paris.
Implications for the London Stock Exchange
The listing of CANAL+ on the London Stock Exchange is expected to provide a much-needed boost to the market, which has experienced a lull in new listings. In the first half of 2024, only eight new companies went public on the London Stock Exchange, raising a total of £513.8 million.
However, there are signs of renewed activity. In June, British computer firm RASPBERRY PI made its market debut, raising around £30 million at a valuation of approximately £540 million. Additionally, fast-fashion giant SHEIN is reportedly preparing for a public offering in the near future.
FCA Reforms and Market Outlook
The Financial Conduct Authority (FCA) has implemented the most significant overhaul of IPO regulations in three decades, aiming to attract more companies to list on the market. These changes are set to take effect at the end of this month, potentially increasing IPO activity in the latter half of the year.
City analysts have expressed optimism about the prospects for the London stock market. “The London stock market is steadily gaining momentum after a challenging two years stifled by macroeconomic and geopolitical uncertainty,” said Scott McCubbin, head of EY’s UK IPO business, last month. He added that the FCA’s reforms have been well-received by the market and are expected to enhance the UK’s appeal as a global listing destination.
