236
Annual Report -
2013
-
Vivendi
4
Financial Report | Statutory Auditors’ Report on the Consolidated Financial Statements |
Consolidated
Financial Statements
| Statutory Auditors’ Report on the Financial Statements | Statutory Financial Statements
Note 2. Major changes in the scope of consolidation
Note 2.
Major changes in the scope of consolidation
Ongoing strategic review
As publicly announced to shareholders on several occasions in 2012 and
2013, Vivendi’s Management Board and Supervisory Board are carrying
out a review of the group’s strategic development. In 2013, Vivendi sold
most of its interest in Activision Blizzard and entered into a definitive
agreement with Etisalat to sell its interest in Maroc Telecom. The
group has decided to focus on its media and content activities, which
hold leading positions and are taking advantage of the growing digital
market. It has strengthened its presence in Canal+ France, now fully
owned. Vivendi is also reshaping SFR. The operator has begun to benefit
from its transformation plan, by re-taking the commercial lead and by
reducing costs. SFR has also entered into an agreement to share part of
its mobile network with Bouygues Telecom, allowing it to offer better
coverage and strengthened service quality to its customers. Based
on this, the group aims to position the future Vivendi as a dynamic
player in media and content. With SFR, it intends to participate in the
reorganization of the telecommunication sector in France, exploring
actively all potential opportunities.
During the second half of 2013, the group reached important strategic
milestones:
on October 11, 2013, Vivendi completed the sale of 88% of its
interest in Activision Blizzard for $8.2 billion (or €6 billion), in cash.
In addition, Vivendi retained 83 million Activision Blizzard shares,
representing 11.9% of Activision Blizzard’s outstanding share
capital, which are subject to a staggered 15-month lock-up period;
on November 4, 2013, Vivendi entered into a definitive agreement
with Etisalat for the sale of Vivendi’s 53% interest in Maroc
Telecom Group for €4.2 billion in cash, including a €310 million
dividend distribution with respect to fiscal year 2012, according to
the financial terms known to date. Completion of this transaction
is contingent upon the satisfaction of certain closing conditions,
including receipt of required regulatory approvals in Morocco and
the countries in which Maroc Telecom Group operates, as well as
finalization of the shareholders’ agreement between Etisalat and the
Kingdom of Morocco. This transaction is expected to be completed
during the first months of 2014 (please refer to Note 7); and
on November 5, 2013, Vivendi acquired Lagardère Group’s 20%
interest in Canal+ France for €1,020 million in cash.
As a result of the sale of Activision Blizzard, Vivendi has begun to
significantly reduce its debt during the fourth quarter of 2013 by
implementing a US dollar and euro bond repurchase program in an
aggregate amount of €3 billion; thus gaining greater financial flexibility
(please refer to Note 24).
2.1.
Planned demerger of the group
On November 26, 2013, Vivendi’s Supervisory Board approved the
group’s planned demerger to form two separate companies: (i) a new
international media group based in France, with very strong positions
in music (as the worldwide leader), in European cinema, in pay-TV in
France, Africa, Vietnam, and Poland, and in the Internet and associated
services in Brazil, and (ii) SFR. The decision to implement this project
could be taken in the near future and, if appropriate, submitted to the
General Shareholders’ Meeting for approval on June 24, 2014.
Vivendi considers that the conditions for the application of IFRS 5 to
the proposed demerger in the 2013 Financial Statements are not met.
2.2.
Acquisition of Lagardère Group’s non-controlling interest in Canal+ France
On November 5, 2013, Vivendi acquired Lagardère Group’s 20% interest
in Canal+ France, for €1,020 million in cash. In accordance with IFRS 10,
Vivendi recorded this transaction as an acquisition of a non-controlling
interest. The difference between the consideration paid and the carrying
value of acquired non-controlling interest was recorded as a deduction
from equity attributable to Vivendi SA shareowners (-€636 million).
In addition, Vivendi and Lagardère Group have settled all disputes
between them (please refer to Note 28). Thereafter, Canal+ France SA
was merged with and into Canal+ Group SA, pursuant to a simplified
merger, with retroactive effect to January 1, 2013.
