Vivendi SAentered into an agreement with MediasetGroup to create an international over-the-top television delivery platform.

Pursuant to the agreement, 3.5% of Vivendi's share capital willbe exchanged for 3.5% of Mediaset's share capital and 100% of the share capitalof the Mediaset Premium pay TV company.

The two companies also will jointly develop initiatives for audiovisualcontent.

The deal was reportedin early April and was initially deniedby Mediaset.

With the agreement, Vivendi aims to expand its foothold in southernEurope using Mediaset's Italy and Spain presence. Vivendi's footprint in the Europeanpay TV scene increases to more than 13 million individual global subscribers.

The transaction is subject to regulatory approval but is expectedto close in coming months.