Frances Legardère Extends Reach Into TV

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Paris -- French industrial conglomerate Legardère S.A. is
strengthening its position in the media business through a number of digital alliances
with Canal Plus S.A.

The company's Legardère Medias unit -- which already
owns stakes in French thematic channels such as La Chaine Meteo -- agreed early this month
to acquire 34 percent of Canalsatellite, Canal Plus' digital direct-to-home platform.
It will also buy 27.4 percent of Multithematiques, a European programming group owned by
Canal Plus, Liberty Media International Inc. and Canal Plus majority shareholder Vivendi
S.A.

Legardère, with investments also extending into the
defense industry, will pay 17 billion francs ($2.9 billion) for the stake in
Canalsatellite. It will buy about 20 percent of that stake from Vivendi and 10 percent
from Time Warner Inc. The remaining 4 percent will be sold to Legardère by Canal Plus
itself.

Legardère's stake in Multithematiques is said to be
worth F1.5 billion ($259 million).

Legardère and Canal Plus also agreed to form two
partnerships, each of which will be 51 percent-owned by Legardère. The first will serve
as an umbrella company grouping Legardère's program-network investments, while the
second will cover interactive services.

In addition, Legardère plans to form joint ventures
directly with Multithematiques to create new channels for international distribution.

The companies have yet to unveil any channels. However,
analysts pointed to Legardère-owned magazines such as Elle and Car and Driver
as properties that hold considerable potential for television development.

A Canal Plus spokesman said the alliance at this point is
exclusively designed for the TV industry, even though the two companies have a strong
interest in developing Internet businesses.

"The Internet is excluded from the alliance at this
point," the spokesman added. "This does not mean that in the future, we may not
work together in this field."

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