Canal+ shares plummet over 22% on London market debut

On December 16, 2024, shares of the French broadcaster Canal+ experienced a significant drop of over 22% following their initial debut on the London Stock Exchange. This decline occurred within the context of a strategic move by media holding company Vivendi, which decided to spin off Canal+ to unlock value potential associated with the company and its assets. Leading up to this event, Vivendi's shareholders had agreed to this separation, which was seen as a response to the conglomerate discount affecting the parent company's valuation. Canal+ is widely known for its pay TV services and production activities, particularly for live sports broadcasting and creating well-received films, such as those from the Paddington franchise. The trading session saw Canal+ shares close around 226 British pence ($2.86), marking a decline of 21.9% from the session's initial opening prices. Notably, the reaction from the market indicates a cautious reception of Canal+'s spin-off, despite its growth in subscribers and diverse offerings. Maxime Saada, CEO of Canal+, remarked on the company's growth trajectory, indicating that Canal+ had tripled its subscribers from approximately 9 million over the past decade. He also emphasized the company's financial strategy that allows for flexibility in content acquisition, particularly regarding expensive sports rights. This strategic positioning is crucial in avoiding the pitfalls faced by other companies in the media sector that have overspent on sports broadcasting rights. The spin-off of Canal+ is part of a larger restructuring effort involving Vivendi, which is also spinning off Havas and the Louis Hachette Group. These entities will be listed on different European stock exchanges, aiming to rejuvenate their market presence. The London listing is particularly significant, as it is the largest addition to the UK stock market since regulatory changes were implemented to enhance the appeal of London for international listings. Given the backdrop of recent departures from the London Stock Exchange, the decision of Canal+ to list there signals a renewed confidence in the UK capital markets and reflects efforts to competently compete against other market hubs, like those in the U.S.