Richemont sells Canal+ interest to Vivendi

Richemont announces that it has entered into an agreement with Vivendi SA in terms of which Richemont has agreed to dispose of its 15 per cent investment in Canal+ SA in exchange for a 2.9 per cent interest in Vivendi. The transaction values Richemont's stake in Canal+ at 1.3 billion Euros. Canal+ is Europe's largest pay television operator. Vivendi, which already holds a 34 per cent interest in Canal+, is a world leader in utilities and a major player in the construction, property and communication industries. The company has a market capitalisation of some 42 billion Euros.

Richemont acquired its interest in Canal+ following the merger of its pay television interests in Scandinavia, the Benelux and Italy with Canal+ in 1997. The current transaction provides Richemont with considerably greater liquidity than its existing investment in Canal+, although Richemont has agreed with Vivendi not to dispose of its shares for a period of 12 months.

Johann Rupert, Chief Executive of Richemont, said: "The transaction allows Vivendi to consolidate its position as the largest shareholder in Canal+, whilst allowing Richemont an opportunity to participate in the growth of Vivendi for as long as we continue to hold the shares. Whilst Richemont has had an excellent return on its investment in Canal+, this transaction will permit us in due course to re-deploy the proceeds in the further development of our core luxury goods business."

Richemont will receive 17 500 000 shares in Vivendi in exchange for its 18 816 636 shares in Canal+. At the close of business on 21 July 1999, Canal+ shares were quoted at 64.50 Euros per share, valuing Richemont's existing holding at 1 213.7 million Euros. Vivendi shares closed at 76.70 Euros, valuing the aggregate consideration at 1 342.2 million Euros.

The transaction is subject to the approval of shareholders in Vivendi at an extraordinary general meeting, which will be held during September 1999.

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Richemont owns a unique portfolio of some of the world's best known luxury goods brands including Cartier, Alfred Dunhill, Montblanc and Lancel, together with the prestigious Swiss watch brands Vacheron Constantin, Piaget and Baume & Mercier. Richemont also recently acquired a controlling interest in Van Cleef & Arpels. In addition to its luxury goods interests, Richemont holds an effective interest of 23.3 per cent in British American Tobacco p.l.c.