World News

Italian court to wait until Feb. 1 to rule on Mediaset pan-European TV plan

By Elvira Pollina

MILAN (Reuters) – An Italian judge will wait until Feb. 1 at the earliest before ruling on a request by France’s Vivendi <VIV.PA> to suspend a planned reorganization at Italian broadcaster Mediaset, two legal sources said on Tuesday.

Controlled by the family of former Italian Prime Minister Silvio Berlusconi, Mediaset <MS.MI> wants to merge its Italian and Spanish <TL5.MC> units into a Dutch entity, dubbed MediaforEurope (MFE).

The broadcaster wants to use the new entity to pursue tie-ups in Europe to take on competition from streaming apps such as Netflix <NFLX.O> and web giants like Google <GOOGL.O>.

But Vivendi <VIV.PA>, which is Mediaset’s second largest shareholder with a 29% stake, is fighting the project in courts across Europe, saying the governance structure of the new entity would strengthen Berlusconi’s grip on the company.

In an effort to smooth the plan, Mediaset shareholders approved changes to MFE’s bylaws on Jan. 10, as suggested by the Milan court. However, Vivendi said the changes did not address its concerns.

The French group filed another urgent appeal on Tuesday, prompting the judge to set a new hearing on Feb. 1 and postpone any decision until then, the sources said after a closed-door session.

Following Vivendi’s legal challenge, a Spanish court has provisionally put the merger on hold. Vivendi filed a similar request with a court in the Netherlands..

Mediaset faces a March deadline to see its Dutch holding company plan through, otherwise the decisions of a September shareholder meeting that approved the project will no longer be valid under Dutch law.

Vivendi and Mediaset have been at odds since the French conglomerate dropped a deal to buy Mediaset’s pay-TV unit in 2016, and then built up a stake in the group which the Italian broadcaster considers hostile.

Two-thirds of that stake is held in a trust after Italy’s telecom’s watchdog IN 2017 ruled that Vivendi was in breach of Italian rules protecting the plurality of the media and telecoms industry, given its 24% holding in Telecom Italia.

(Reporting by Elvira Pollina; Editing by Jan Harvey)