ROME — Vivendi chairman Vincent Bolloré and managing director Arnaud De Puyfontaine are under investigation by Milan prosecutors for alleged stock market manipulation in connection with the French media conglomerate’s recent rapid stake building in Italian TV group Mediaset.
Under Italian law being under investigation is not tantamount to being indicted.
As a Vivendi statement put it, “this does not in any way signify any accusation against any person.”
“The registration of Vivendi executives by the Milan public prosecutor is the result of an unfounded and abusive lawsuit filed by the Berlusconis against Vivendi after the increase of its stake in Mediaset,” according to the Vivendi statement.
In December 2016 Milan prosecutors opened a preliminary probe into Vivendi’s aggressive stake building in Mediaset, following formal legal action taken by Fininvest, the holding company of the Berlusconi-owned broadcaster.
Fininvest’s complaint came amid escalating hostilities between the two European media groups when Vivendi, after revealing a 3% stake purchase rapidly rose to just under 30% of Mediaset shareholding and voting rights – the upper limit above which it would be legally obliged to launch a takeover bid.
Vivendi’s rapid-fire purchase of Mediaset stock came after the two companies sparred in court over a partnership agreement they signed in April 2016. Vivendi essentially subsequently pulled out of that deal in July, leading Mediaset to allege breach of contract. Mediaset has sued Vivendi for 1.5 billion Euros ($1.59 billion) in damages, claiming Vivendi’s pullout from the deal caused the stock price to plummet.
Under the terms of that partnership agreement, the two groups would have reciprocally swapped a 3.5% stake and Vivendi would have acquired Mediaset’s pay-TV business, Mediaset Premium.
Elsa Keslassy contributed to this report.