An Italian court will likely decide after the summer whether French media group Vivendi needs to reduce its stake in Telecom Italia or Mediaset to prevent a concentration of power, two legal sources said on Wednesday.
Last year, the national communications authority (AGCOM) ordered Vivendi to cut its stake in one of the two companies within a year, ruling it was in breach of rules designed to prevent a concentration of power.
Vivendi, which aims to build a media empire in southern Europe, is the biggest single shareholder in Telecom Italia with a 24 percent stake and had accumulated a 28.8 percent shareholding in private broadcaster Mediaset, controlled by the family of former Prime Minister Silvio Berlusconi.
Vivendi appealed AGCOM`s decision but in April this year it transferred 19.19 percent of its stake in Mediaset to a trust called Simon Fiduciaria to comply with the order.
A ruling in favour of Vivendi could mean the French group gets back ownership of the stake it transferred.
"There will be a decision no earlier than 45 days, but more probably after the summer," one of the sources said.
One of Vivendi`s lawyers did not rule out a possible complaint to the European Commission on the issue.
"Vivendi has not presented a complaint to the EU Commission because it has full confidence in Italy`s justice system which applies EU laws. But if that is not the case we will call on the Commission," one of Vivendi`s lawyers, Giuseppe Scassellati Sforzolini, said.
Vivendi`s lawyers have argued the decision by AGCOM is discriminatory and goes against both Italian and European rules given Vivendi does not exercise a dominant influence on Mediaset.
At its latest shareholder meeting, Milan-based Mediaset, closed the doors of its AGM to the trust, preventing it from exercising its voting rights. Vivendi decided not to present a slate of candidates for the new 15 member Mediaset board.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)