Vivendi bids for video site Dailymotion as PCCW drops out

Paris/Toulouse: Vivendi SA offered to buy YouTube’s smaller rival Dailymotion from Orange SA while another bidder, Hong Kong-based PCCW Ltd, said it dropped out because France prefers a European purchaser for the video service.

Television and music company Vivendi, based in Paris, confirmed the proposal in a statement on Tuesday, without giving details. The offer will be discussed at an Orange board meeting on Tuesday, Le Monde reported earlier, without citing anyone. Vivendi may pay more than €250 million ($273 million), Figaro reported, also without saying how it got the information.

Orange, France’s largest phone carrier, has been seeking a partner to help boost Dailymotion’s business outside its home market. Chief executive officer Stephane Richard said last month he was talking to PCCW and others interested in a minority stake in Dailymotion. The Financial Times said last May that Vivendi’s Canal Plus was in informal talks with Orange about a Dailymotion stake.

A Vivendi representative declined to comment beyond the company’s statement. A representative for Orange also declined to comment. PCCW said on Monday it had ended talks because of France’s resistance to a non-European purchaser.

Shares of Vivendi added 1% to €23.46 at 9:55am in Paris. Orange gained 0.8% to €15.21.

Strategic asset

Orange, formerly France Telecom, bought its initial 49% stake in Dailymotion, a competitor to Google Inc.’s YouTube video-streaming service, in 2011 for €58.8 million, and paid €61 million in 2013 to gain full control. Dailymotion, created in 2005 by Frenchmen Benjamin Bejbaum and Olivier Poitrey, gets more than 100 million unique visitors a month, about a 10th of the number for YouTube.

In 2013, Orange’s talks on a transaction with Yahoo Inc. fell apart after then-industry minister Arnaud Montebourg blocked the sale of Dailymotion to a foreign investor and called the asset strategic. France owns a 24.9% stake in Orange.

France’s industry minister Emmanuel Macron, speaking last week through a representative, said all options must be studied for Dailymotion, while keeping in mind the digital sovereignty of Europe. Bloomberg