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UPDATE 1-Mediaset clashes with Vivendi after trust excluded from key meeting

Elvira Pollina

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MILAN, Sept 4 (Reuters) - Italian broadcaster Mediaset said it would exclude the trust holding most of Vivendi's stake in the company from voting on a corporate overhaul, drawing the ire of the French media group.

Mediaset shareholders are being asked on Wednesday to approve merging the Italian company with its Spanish unit Mediaset Espana, putting both groups under a newly created Dutch holding called MediaforEurope (MFE).

Mediaset, controlled by the family of former Italian Prime Minister Silvio Berlusconi, aims to use the new entity as a platform to develop continental alliances with other broadcasters and tackle competition from video-streaming services like Netflix and Amazon Prime Video.

But Vivendi, led by media tycoon Vincent Bollore, opposes the plan because it includes a governance structure and a loyalty share scheme that would tighten the grip of Berlusconi's family on the group.

"The board resolved unanimously to oppose the request by (the trust) Simon to exercise voting rights relative to the Simon stake," Mediaset said in a statement, adding it would deny it access to the shareholder meeting.

Two-thirds of Vivendi's stake in Mediaset is held by the arms-length trust Simon Fiduciaria which has in the past been barred from voting by an Italian court.

That leaves Vivendi with 9.99% direct voting rights it can exercise but which is not enough to block the deal on its own.

Mediaset is controlled by the Berlusconi family holding, Fininvest, which has a 45.8 percent stake, meaning it is almost certain of getting the plan through.

In a statement on Wednesday Vivendi condemned Mediaset's refusal to allow the trust to vote, saying it would challenge Mediaset's plan to reorganise its businesses in court.

"Mediaset is disregarding the most basic shareholder rights and principles of corporate governance with the sole objective of favouring Fininvest, without even recognising a premium to minorities," it said.

Vivendi has been a hostile Mediaset shareholder since Bollore and Berlusconi fell out in 2016 over an aborted pay-TV deal and the French group built a 29% stake. (Additional reporting by Mathieu Rosemain in Paris writing by Stephen Jewkes Editing by Keith Weir)