Financial analysts are beginning to piece together the jigsaw that could see Vivendi acquire Vodafone's shareholding in the French mobile operator SFR. The issue, according to one London-based analyst, was all about price and funding, "and Vodafone would gladly sell at the right price."
Vivendi, which has given increasingly strong indications over the past few months that it wants full control of SFR, is already €9.5 billion in debt. However, financiers believe that the company could acquire SFR for around €8 billion without Vivendi foregoing its dividend or its BBB credit rating, such is the strength of SFR's cash flow.
While Vivendi is expecting the sale of its 20 per cent shareholding in NBC Universal to General Electric to raise around US$5.8 billion, the extra cash flow from complete ownership of SFR is being seen as providing the company with the ability to raise overall debt levels.
Vodafone's only comment on the speculation was that SFR was a 'good asset with good dividend flow.' However, given Vivendi's obvious intent to pursue total ownership of SFR, the established view that Vodafone's 44 per cent holding in SFR was worth around €5 billion is crumbling and analysts are now seeing this acquisition as costing Vivendi as much as €8 billion.
The French firm, which recently bought control of Brazilian operator GVT for about US$4.3 billion, has denied reports that it was negotiating to buy a 26 per cent stake in the Indian mobile operator Reliance Communications.
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