21 JUL 2023

Vivendi's Canal+ buys 12% stake in Viaplay Group

Canal+ Group bought its stake after Viaplay announced earlier on Thursday that it planned to let go of more than 25% of its staff.


Vivendi's Canal+ Group had bought a 12% stake in Sweden's Viaplay, driving shares in the Swedish media group up 23%. Canal+ Group bought its stake after Viaplay announced earlier on Thursday that it was planning to let go of more than 25% of its staff, saying it would focus on "those markets where it could compete in the long term." Viaplay's announcement on Thursday made its shares dive 29%.

Canal+ did not disclose any financial details for the deal. Based on Viaplay's closing price on Thursday, it would be worth 332.5 million Swedish kronor ($32.1 million). Viaplay's shares had fallen 82% since the beginning of the year through Thursday. Before disclosing Canal+'s stake, Viaplay said it considered all options, including content sublicensing, asset disposals, equity injections, or the sale of the whole group. The company also said it would focus on its core Nordic, Netherlands, and Viaplay Select operations and downsize, partner, or exit the rest of its international markets, which include the US, the UK, and Canada. The acquisition of a 12% stake makes Canal+ Viaplay's largest single shareholder. At the end of last year, institutional investors owned approximately 82% of the share capital, with Swedish private individuals owning about 10%. Norges Bank, Nordea Funds, Handelsnanken Funds, and Schroders were the most significant shareholders.

In France, Canal+ is on the brink of completing the acquisition of rival streamer OCS, in which it has a 33% stake. Through its ownership of M7 Group, it also has a significant presence in the Benelux countries and central and eastern Europe. The Vivendi subsidiary boasts more than 25.5m subscribers and is present in more than 50 countries with 130 linear and non-linear channels produced in-house. It is a majority shareholder in leading African pay-TV platform MultiChoice and also aggregates major thematic channels and global content platforms such as Netflix, Disney+, Paramount+, and Apple TV+.

In the future, Viaplay Group will focus on the Nordic markets with the new operating model in place, on the right content mix, developing its soon-to-be profitable Dutch operations, and selling its content internationally through Viaplay Select. The company is focusing its attention and resources on those markets where it can compete for the long term and ensure that its products are relevant, popular, and generate healthy returns.

Viaplay will exit the US and UK markets along with Poland and the Baltic States to focus on its core Nordic territories and the Netherlands. The company is to discontinue its low-tier non-sports offering in these international markets to focus on its sports offering and the sale of non-sports content through its Viaplay Select business. The streamer's Q2 results saw sales rise, but operating income plummeted. Net income turned to a loss of SEK5.8 billion as the downturn in the advertising market and lower-than-expected streaming numbers undermined its growth projections.

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