Shaul Shani is selling Brazilian communications provider GVT Holding SA (Bovespa: GVTT3) to French telecommunications giant Vivendi SA (Euronext: VIV).
Shani controls GVT Brazil through Swarth Investments LLC, Swarth Investments Holdings LLC (together the Swarth Group), together with the other controlling shareholder, Global Village Telecom (Holland) BV. He serves as chairman of GVT Brazil, whose CEO is Amos Genish. Both men will continue in their posts.
Shani acquired GVT from Nochi Dankner-controlled IDB Holding Corp. Ltd. (TASE:IDBH) and its subsidiary Discount Investment Corporation (TASE: DISI) in September 2008. Swarth Group also owns ECI Telecom Ltd.
Vivendi will offer 42 real ($22.96) per share, a 15.8% premium on GVT's closing price yesterday for 100% of GVT. The offer, which the companies call an "amicable tender offer", reflects a company value of $2.95 billion for GVT.
The deal is conditional on Vivendi acquiring a minimum of GVT Brazil through the tender offer. Swarth Group and Global Village Telecom Holland own about 30% of GVT Brazil, and will sell Vivendi a minimum of 20% of the company in the tender. They have also agreed to vote in favor of the waiver of the anti-takeover mechanism provided for in GVT’s by-laws, in favor of Vivendi’s offer. The tender offer is conditional on Vivendi's board approving the deal and the completion of due diligence on GVT by October 16.
Shani said, "I am very pleased to have Vivendi joining GVT as a strategic shareholder. We see it as a great opportunity to enhance value for GVT’s shareholders and we intend to maintain a portion of our position after the tender offer. The partnership with Vivendi is another important milestone in creating shareholder value as we have done since the company’s IPO. We will work closely with Vivendi to boost the company’s broadband value proposition with substantial additional content enhancement."
GVT has 2.3 million fixed-line telephone lines in 81 cities in Brazil. The company posted an operating profit of $300 million on $800 million revenue in 2008.
Published by Globes [online], Israel business news - www.globes-online.com - on September 9, 2009
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