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Vivendi to return US$6.4b to investors

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Vivendi SA, the French conglomerate that's refocusing on media businesses, plans to return about 5.7 billion euros (US$6.4 billion) to investors after selling more than US$30 billion of assets.

[PARIS] Vivendi SA, the French conglomerate that's refocusing on media businesses, plans to return about 5.7 billion euros (US$6.4 billion) to investors after selling more than US$30 billion of assets.

The amount will be paid through a combination of dividends and share buybacks by mid-2017, the Paris-based owner of Universal Music Group and Canal Plus said in a statement Friday. Vivendi said its board approved an agreement to sell its remaining 20 per cent stake in cable and wireless carrier Numericable-SFR to Altice SA for 3.9 billion euros.

Chairman Vincent Bollore has been leading deliberations on how to spend Vivendi's cash as the company scouts potential acquisitions.

While Vivendi has identified some targets, valuations are high and the company won't rush into a transaction, said Arnaud de Puyfontaine, chairman of the management board.

"We want a track record of Vivendi as a savvy allocator of resources," he said on a conference call. "Give us another 12 to 18 months to be able to bring evidence." The company, based near the Arc de Triomphe in Paris, under Bollore's direction has divested telecommunications assets, including a stake in Maroc Telecom and its French mobile unit SFR. The latter was sold to billionaire Patrick Drahi for 17 billion euros. Vivendi in September agreed to sell its Brazilian broadband business GVT to Telefonica SA for about 7 billion euros.

Vivendi reported fourth-quarter net income of 2 billion euros, compared with 556 million euros a year earlier, as sales rose 0.4 per cent to 3 billion euros, in line with analysts' estimates.

Of its remaining assets, Universal Music Group is the world's largest music company, while pay-TV provider Canal Plus has been expanding outside France. Music streaming and the foreign operation of Canal Plus will fuel a slight increase in sales this year, the company said. Vivendi also said earnings would increase.

In April last year, after Vivendi agreed to sell SFR, it said it would return as much as 5 billion euros to shareholders in 2014 and 2015 through dividends and share buybacks. Since then, it's sold more assets including GVT as well as stakes in Activision Blizzard Inc and Apple Inc's Beats.

BLOOMBERG