Europe’s biggest entertainment group Vivendi, has snatched control of Brazilian carrier GVT away from rival bidder Telefónica.
Vivendi CEO Jean-Bernard Levy described the transaction as “the revenge of the underdog.” Vivendi outbid Telefónica with its $4.18 billion offer - trumping Telefónica’s $4 billion bid.
But the hefty bid - which is a 33% premium over the company's original offer made in September – has drawn the ire of investors, who have pulled Vivendi's share price down 2.6% since the announcement was made.
Analysts have also expressed concern over the price, believing the offer has damaged the company's reputation for disciplined spending during acquisitions.
Vivendi acquired the 39.7% stake, late last week and has unconditional options to buy a further 19.6%. Vivendi said it was launching a mandatory tender offer for 100% of the carrier’s capital at 56 Brazilian reais per share, valuing the company at 7.2 billion reais ($4.2 billion).
“Our offer to acquire the control of GVT reflects the exceptional quality of this operator and its teams, as we have been able to confirm after a thorough analysis of its business model and performance record,” Lévy said in a statement.