Canal+ shares slide on London debut

(Sharecast News) - Shares of French broadcaster Canal+ tumbled nearly 16% during its London Stock Exchange debut on Monday, marking a rocky start for the largest new listing in the UK this year. Canal+, a spin-off from communications giant Vivendi, opened at 290p but quickly fell to 243p, valuing the company at about £2.6bn.

Analysts and company advisors were optimistic, however, suggesting its valuation could rise to over €6bn as the market stabilised.

The spin-off was part of a broader restructuring of Vivendi, the Paris-based conglomerate controlled by the Bolloré family.

Shareholders overwhelmingly approved the move, with Vivendi's leadership citing the potential to unlock value from its disparate divisions, which were seen as undervalued within the group.

Alongside Canal+, Vivendi was also spinning off advertising firm Havas in Amsterdam and publishing house Louis Hachette Group in Paris.

While the London listing was heralded by UK chancellor Rachel Reeves as a "vote of confidence" in the UK's capital markets, this year had still seen a net outflow of companies from the City's main market, with nearly 90 delistings compared to just 18 new entries.

The government was actively reforming listing rules to revive the UK's appeal as an investment hub.

Canal+ is best known for its subscription television services, live sports broadcasting, and Studiocanal, the production arm behind the popular Paddington film franchise.

The company had rapidly expanded its subscriber base beyond France, with two-thirds of its subscribers now located in Africa, Eastern Europe and Asia.

However, its valuation remained below that of UK rival ITV, despite Canal+ generating larger annual revenues.

Looking at the stock's early volatility, some funds restricted to French-listed stocks were compelled to sell, while other investors reportedly exited for tax reasons.

Vivendi's Paris-listed shares surged over 33% following the spin-off.

At 1053 GMT, shares in Groupe Canal Plus were down 15.48% at 245.1p.

Reporting by Josh White for Sharecast.com.