Bloomberg News

RCS Will Consider Approaches for Flammarion, Non-Core Assets

January 23, 2012

Jan. 20 (Bloomberg) -- RCS MediaGroup SpA, the publisher of newspaper Corriere della Sera, said it will study approaches for assets including French publisher Flammarion.

RCS’s executive committee, which met yesterday in Milan, said there will be a preliminary review of any expression of interest “in relation to assets not straightly included in the core business, comprising Flammarion, and non-core assets,” the company said in a statement last night.

RCS received an approach for Flammarion from French competitor Gallimard, Economiaweb reported on its website on Jan. 17. RCS is seeking to raise as much as 200 million euros ($259 million) from the sale of Flammarion, the website said.

“The French business in the past has ever been strategic for the company, but a disposal could help to reduce debt by at least 15 percent, lowering risks for a capital increase,” Fabio Pavan, an analyst at Mediobanca Securities, wrote in a note today.

There may be advantages in the potential disposal “taking into account the significant reduction of RCS financial risk,” according to Andrea Devita, an analyst at Banca Akros. RCS had net debt of about 980 million euros at the end of September.

The company said in June that it received “inadequate” offers for eight of its publications after receiving expressions of interest for magazines including weekly Il Mondo. RCS authorized Chief Executive Officer Antonello Perricone to carry out “further enquiries necessary to identify the most suitable measures for restructuring the magazines and improving their profitability, or for selling them,” it said at the time.

--Editors: Robert Valpuesta, Simon Thiel.

To contact the reporters on this story: Chiara Remondini in Milan at cremondini@bloomberg.net; Francesca Cinelli in Milan at fcinelli@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net


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