The European Commission on Tuesday approved media conglomerate Vivendi's "controversial plans to take de facto control of Telecom Italia" on the condition that it sells its stake in broadcasting company Persidera, according to Toplensky & Fildes of the FINANCIAL TIMES. The potential sale of Persidera has been "the subject of some debate in Italy amid reports that it had been offered as a concession by Vivendi." Telecom Italia, which controls 70% of the broadcasting company, said earlier this month that it "had not analysed such a move." The issue was not due to be discussed at Telecom Italia's meeting of its newly-constituted board on Thursday in Milan but the competition regulator's decision is "likely to force it onto the agenda." The European Commission "required the disposal of Persidera as it was concerned that after the combination, Vivendi could increase prices for wholesale access to digital terrestrial networks" as it would own a 28% stake in Mediaset, the Italian pay-TV company, and Telecom Italia's part in Persidera (FT, 5/30). REUTERS' Chee & Flak reported Telecom Italia and Vivendi shares were "little changed after the ruling," with traders saying that the market had "already priced in the fact that Vivendi had de facto control of Telecom Italia." Vivendi had been expected to put forward CEO Arnaud de Puyfontaine as Telecom Italia chair "when the board came up for renewal this month," sources said, but incumbent Giuseppe Recchi was "confirmed in the post pending the EU ruling." Analysts said that investors were "more concerned about the impact of a separate regulatory review in Italy on Vivendi's plan to build a media empire in southern Europe" (REUTERS, 5/30).
