Canal+ acquires rival M7 for Euros 1 Bln

Canal+ Group, the pay-TV subsidiary of France’s Vivendi, said on Monday that it has acquired rival pay-TV operator M7 for around €1bn to expand its European footprint, as the group seeks to defend itself against the onslaught of Netflix.

Canal+ said it has bought M7, an independent pay-TV company that operates in Benelux and central Europe, from private equity firm Astorg for slightly over €1bn. The deal will allow Canal+ to expand its presence beyond France, Poland and Switzerland into seven new countries.

Netflix is reshaping the media landscape as the US streaming giant pours billions of dollars into creating original film and television content, putting pressure on a market that was once dominated by groups such as Canal+ and eating into its subscriber base.

In February Netflix confirmed that it now has more than 5m subscribers in France, which means it has overtaken Canal+ as the leading pay-TV provider by number of subscribers in the home market of Canal+. At the end of December Canal+ reported 4.73m subscribers in France, down from 5.25m two years earlier.

M7 has a turnover of more than €400m and 3m subscribers. It distributes major national channels as well as labels including Disney Channel, HBO Eurosport, National Geographic and Nickelodeon.

The deal opens up another distribution platform to the content that Canal+ Group produces each year, including through StudioCanal, its film production and distribution subsidiary.

“This major operation will allow us to strengthen our distribution capacity in order to leverage content originating from our library and our numerous production operations in Europe,” said Maxime Saada, chairman of the Canal+ Group executive board, in a statement.

He said the acquisition will allow Canal+ to approach 20m subscribers globally.

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