French pay-TV operator Canal Plus has frozen negotiations with Italian electrical utility Enel to sell a 30 per cent stake in the French group’s Italian digital platform Telepiu.

On February 9, Enel admitted its planned purchase of a stake in Telepiu had run into problems, which both sides were discussing. Commenting on press reports, a spokeswoman confirmed that “outstanding problems are being studied,” adding that “due diligence is still under way.” For its part, Telepiu sources said talks were officially still continuing but a “pause for reflection” had begun. The report in the La Repubblica daily said the Telepiu deal had fallen through following Vodafone’s (which is linked to Canal Plus through a series of cross-alliances) take-over bid for Germany’s Mannesman, which in turn controls Italian telecom ventures Omnitel and Infostrada. Canal Plus’ parent company, Vivendi has a deal with Vodafone to create an Internet portal in Italy, in direct competition with Wind, the Italian telecom venture in which Enel has a 51 per cent stake. Also, Enel seems to have second thoughts regarding the size of the investment, amounting to around L900 billion (Euro 465 million). Canal Plus and Enel had signed a preliminary agreement in August and the 30 per cent stake that Enel was intending to purchase was estimated to be worth as much as L1,000 billion. The deal would have allowed Canal Plus to achieve its stated goal of bringing strategic Italian partners on board as Telepiu shareholders, while Enel would fulfil its strategy of expanding into other markets. If the deal falls through, Canal Plus will retain around 99 per cent of Telepiu, with Italian pubcaster RAI holding the remaining one per cent stake.