Vivendi Universal is expected to put its Canal Plus Technologies (CPT) unit up for sale in the latest debt debt-reduction move.
The business, which produces software for pay-TV encryption and interactive broadcasting and set-top boxes for Canal Plus' channels, is valued at between Euros500m and Euros1bn. That could mean Vivendi's debt levels would be brought down by upto Euros500m.
Likely bidders are expected to include Liberate Technologies of the US and Kudelski of Switzerland. It is not known whether NDS, the News Corp subsidiary, would also be in the running now that litigation has been dropped following last week's agreement that Vivendi Universal sell TelePiu to News Corp.
Thomson Multimedia, Spain's Sogecable and Japan's Sony each own 3% stakes and the US' Sun Microsystems has a further 1.7% interest. Thomson has said that it might increase it stake.
Under Canal Plus, CPT was to have been floated separately on the stockmarket, but the IPO was cancelled due to poor market conditions. However, since then the outlook for both interactive TV suppliers and the company's pay-TV clients has weakened considerably. The sector is now in a consolidation phase.
On the basis of the valuation when Sogecable bought its shares last year CPT could be valued at Euros1.7bn. But if it were valued on the same 4.5 times revenues basis as OpenTV, which was recently sold to Liberty Media, it could be valued at a more lowly Euros520m.