Vivendi Sells Remaining Stake in Telefonica Brasil

By Nick Kostov

PARIS--Vivendi SA on Thursday said it's selling its remaining stake in Telefonica's Brazilian unit GVT, a move that adds more cash to its multi-billion euro war chest and allows the French media conglomerate to refocus its efforts on Europe.

Vivendi made the announcement in a regulatory filing on Thursday, in which it said it had sold its 4% stake in Telefonica Brasil for approximately $877 million.

The move comes after Vivendi said Wednesday it had swapped a 3.5% stake in Telefonica's Brasil unit for a 0.95% stake in the Spanish telecom firm, valued at EUR630 million ($696 million) at Wednesday's market prices.

It completes a swift exit from Telefonica Brazil for the French company and its chairman Vincent Bollore who had kept a 7.5% stake after selling off its Brazilian unit GVT to Telefonica for about EUR7.24 billion last year.

" [The ] transaction reflects the Group's intention to become more active in Europe and to pursue strategic partnerships there," Vivendi said Wednesday.

Mr. Bollore has pledged to make Vivendi's units work more closely together as the company has refashioned itself into a media company in recent years, selling assets in videogames and telecommunications. Its two fully owned assets at present are French pay TV Canal Plus and U.S.-based music company Universal Music Group.

Vivendi didn't say what it would do with the cash. The company already has a cash pile of roughly EUR10 billion from asset sales, prompting analysts and investors to question what the company would do with the extra money.

Last month, Vivendi boosted its stake in Italian telecom firm Telecom Italia to 14.9%, raising further questions about the company's strategy.

Writet to Nick Kostov at [e-mail]

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