How London snared France’s Canal+ to revive moribund listing market

The irony that a French company is set to become the largest flotation in London for more than two years, a time when homegrown corporate successes have shifted to the US, has not been lost on bankers in the City. 

Canal+ is not just any French company, but one that carries deep “cultural significance” across the channel, according to Maxime Saada, who heads the streaming giant and film producer that is part of Vivendi, the media conglomerate controlled by the billionaire Bolloré family. 

Coming just weeks after Canal+ put on the Paddington in Peru premiere in London, the UK stock exchange has rolled out its own version of a red carpet after ministers overhauled and streamlined listing rules for the first time in 30 years this summer. Saada said that London’s markets revamp “to make it as easy, as smooth as possible” was a major factor in picking the UK capital.

Canal+, which has a book value of close to €7bn, is expected to have a market capitalisation of between €6bn and €8bn, said people close to the listing. This would make it the largest primary listing in London since Haleon was spun out of GSK in 2022 at a market valuation of about £30bn, during a period of remarkable drought for a global stock exchange that led to concerns over its rules and lack of domestic UK investor appetite. 

Canal+, which has produced hits including Versailles, is the largest of three businesses being spun out of Vivendi. If a $2.9bn deal to acquire South Africa’s MultiChoice completes early next year, the combined business could be worth as much as €10bn, according to those close to the deal.

With the Bollorés having long argued that the French market’s valuation of the Vivendi business is less than the sum of its parts, the split will test how much more the company’s divisions will be valued separately.

Saada now needs to convince UK investors that Canal+ — like Paddington — has found its right home in London, with plans to use the country as a launch pad for global expansion that he hopes could double the size of the business.

There have been just over a dozen primary listings in London this year, according to data compiled by MKP Advisors, the biggest of which was Raspberry Pi at about £540mn. Bankers struggle to remember the last time that a major French company has crossed the channel for London.

Speaking in an office in the Parisian suburb of Issy-les-Moulineaux that will continue to be the headquarters for Canal+, Saada admits that the decision to relocate the company’s ownership to the London stock exchange disappointed some in the Elysée.

He has sought to allay concerns in France — where it will also continue paying tax — but has also made it clear that the future of the company lies elsewhere, with London bringing greater visibility as a global company and access to international investors. 

“I believe [the French authorities] are relieved that the company headquarters and tax structure is [in] France. We’re not the first French company [to list elsewhere]. Of course, there are some adverse reactions and some people are disappointed. But when we tell our story . . . they understand.”

Canal+ has close to 27mn subscribers to its streaming and TV platforms across 50 countries, of which about 60 per cent are outside France, alongside a TV and films studio arm. In the first nine months of 2024, the company reported a 3.2 per cent rise in revenues to €4.72bn.

“When we look at the path for the future, the partners, the competitors, the markets, the investors, almost all of them are English speaking,” said Saada.

“We used to be a French company, completely relying on the French market for its revenues, its profits, its rights and most of its stuff. And we have transformed into a company that is now international. I cannot say global yet, but that’s the plan.”

M&A will form part of this plan. Adding MultiChoice’s African business, Canal+ will have more than 40mn subscribers; Saada wants to take this to 100mn.

“We don’t want to overextend ourselves, and we’re very careful on the way we spend money. But we need scale. At 27mn [subscribers], you are already a sizeable player. At 40mn/50mn, you are definitely a contender. Higher than that, it’s interesting. That is the only topic.”

Canal+ is already considering taking a majority stake in Asian streamer Viu, while Saada says that Viaplay, the Scandinavian steaming service, could be another potential target. 

Vivendi became the largest shareholder after an emergency recapitalisation of the Nordic media company this year, although it has signed a standstill agreement with the second-biggest investor, the Czech group PPF.

“It’s a possibility. And there are others. If you look at significant pay TV players in the world, there are others. I want to be in a position where we can be a consolidator,” said Saada.

He says that the company was attracted by the new flexibility in rules for the London stock exchange, with the company in effect set to operate a hybrid of French rules allowed under its incorporation in that country and London’s regime.

“We started speaking [with the LSE] about what it means to be a company headquartered in France and listed in the UK. We are the only of our kind, I believe. So it means that not all rules will apply to us.”

These include London’s rules that board members be subject to re-election annually, he said, with Vivendi instead implementing the French standard of more than three years. The Bolloré family will also retain a stake of about 30 per cent in London-listed Canal+, equivalent to what it owns in Vivendi.

As a result, Canal+ is unlikely to be eligible for inclusion in the FTSE 100 rankings. But Saada said that the company was already attracting interest from investors in the UK, even if the company was still not clearly understood by all in the market. He pointed to the need to show the capabilities of the company’s streaming platform, which bundles together content from most of the large US streamers as well as hundreds of live channels and sports. 

Not all existing investors are happy, however. Paris-based asset manager CIAM has raised concerns that minority shareholders will take a hit and that the plan will not close the conglomerate discount. It also warned that the family could also increase its stake without launching a full takeover.

Vivendi declined at the time to comment but a person with knowledge of the situation said the group’s plan “was built on shareholder democracy”.

Saada added: “My focus is, and I believe that is what the Bollorés have proven in the past, to increase the valuation of the company for all shareholders.” 

The decision to split Vivendi is subject to a shareholder meeting on December 9, which requires two-thirds of votes to pass. Saada is confident that it will.

By mid-December, he hopes to be at the front of London’s stock exchange to celebrate its first day of trading. And, despite requests, he says Paddington and his marmalade sandwiches will not be with him this time.