French satellite operators Canal Plus and TPS will merge to form a new group controlled by Vivendi Universal SA, AP reported.
Once the transaction is finalized, Vivendi will own 85% of the combined entity, Television Francaise 1 will own 10% and Metropole Television -- which is 48%-owned by Bertelsmann AG unit RTL Group -- will own 5%, according to AP.
Fideuram Wargny analyst Pierre Bucaille estimated that Canal Plus has some 8.4 million subscribers and TPS has about 1.4 million, AP reported.
According to AP, Vivendi will pay $180 million for an 18% stake in TPS in a preliminary phase of the deal. Under terms of the agreement, Vivendi would subsequently merge Canal Plus with TPS, taking control of the combined entity and recovering the $180 million payment.
Vivendi has long advocated the merger, noting that France is one of the few large European markets with two satellite pay TV operators, according to AP.