grinner
05-13-2003, 04:33 PM
INTERVIEW-Vivendi faces eventual spin-off choice
Reuters, 05.13.03, 9:05 AM ET
By William Emmanuel and Tim
Hepher
PARIS, May 13 (Reuters) - Vivendi Universal could eventually be split up but it has not yet decided whether to go that route or remain as a conglomerate linking its slimmed- down media and telecoms units, according to a senior board member.
Claude Bebear, the Axa insurance chief who was credited with helping to drive out ex-CEO Jean-Marie Messier when Vivendi almost collapsed last July, told Reuters the media group has won time to consider its final shape after rescheduling its debts. "Right now we are negotiating the sale of Vivendi Universal Entertainment," he said in an interview, referring to plans announced last month to sell the main U.S. subsidiary containing Universal Studios, theme parks and American television assets.
"We are not negotiating to sell (Universal) Music nor anything else apart from small companies which made up part of the group," Bebear said, adding that Vivendi had never intended to get out of music despite rumours of a bid from Apple.
Vivendi embarked on a massive programme of asset sales as soon as Bebear protege Jean-Rene Fourtou took over as the troubled firm's new CEO at the height of a cash crisis last July, with Bebear heading a new financial panel on the board.
After months of doubts over how the group would look in a year or two's time, Fourtou set out his strategy to shareholders last month, saying Vivendi would focus on music, its cash-rich French telecoms arm Cegetel and French pay-TV unit Canal Plus.
"It was obvious that we had to try to keep Cegetel whatever happened -- it's a formidable cash machine. As for (loss-making) Canal Plus, we didn't really have any other choice than to keep it and clean it up," Bebear said.
He defended Vivendi against criticism that its strategy consists of keeping a trio of broadly disconnected businesses.
"I'd be delighted if there were other strategies. At the (April 29) AGM I didn't hear anyone come along with any staggering ideas on strategy," Bebear said.
With its strategy taking shape, and with VUE on the block and its debts recently refinanced to avoid another cash squeeze, the new-look Vivendi is in no hurry to address the lack of crossover benefits between its three core businesses.
"Either there is a spin-off -- that's one possibility -- or there could be a conglomerate which would nonetheless be limited in scope," Bebear said, on being asked whether Vivendi could split up to shake off a discount seen as afflicting its share price.
"You can't be in too many different businesses. We can have three. There's a choice to be made there, on which Jean-Rene Fourtou has yet to reach a firm conclusion."
LIFE AFTER FOURTOU
At 13.74 euros, Vivendi's share price is up 48 percent from last year's lows but has been limited by a routine holding company discount as well as lingering uncertainty over upcoming asset sales. Its performance is in line with the European media sector this year.
Bebear, who has repeatedly denied pulling the strings in French capitalism or at Vivendi in particular, tried to dampen concerns that Fourtou's decision to retire again at the end of next year would usher in a new period of uncertainty.
Bebear was among those who persuaded Fourtou to come out from semi-retirement as vice- chairman of drugs firm Aventis to replace Messier when Vivendi's banks closed in last summer.
"When he (Fourtou) said he was giving himself two years that didn't mean 'after me, anything can happen'. If in two years Vivendi decides to remain a conglomerate, then it will have a CEO. If there's a spin-off, there's a spin-off."
Bebear also defended Vivendi's decision to award Fourtou a million stock options at 12.10 euros last October. The move emerged in a filing in recent weeks. Messier had come under continuous fire at the end of his career over share options.
"They were granted to him with the company in the state in which he found it. They are blocked for four years," he said.
"If in four years he has turned the company round he will earn money. If he doesn't, he won't."
Copyright 2003, Reuters News Service
Reuters, 05.13.03, 9:05 AM ET
By William Emmanuel and Tim
Hepher
PARIS, May 13 (Reuters) - Vivendi Universal could eventually be split up but it has not yet decided whether to go that route or remain as a conglomerate linking its slimmed- down media and telecoms units, according to a senior board member.
Claude Bebear, the Axa insurance chief who was credited with helping to drive out ex-CEO Jean-Marie Messier when Vivendi almost collapsed last July, told Reuters the media group has won time to consider its final shape after rescheduling its debts. "Right now we are negotiating the sale of Vivendi Universal Entertainment," he said in an interview, referring to plans announced last month to sell the main U.S. subsidiary containing Universal Studios, theme parks and American television assets.
"We are not negotiating to sell (Universal) Music nor anything else apart from small companies which made up part of the group," Bebear said, adding that Vivendi had never intended to get out of music despite rumours of a bid from Apple.
Vivendi embarked on a massive programme of asset sales as soon as Bebear protege Jean-Rene Fourtou took over as the troubled firm's new CEO at the height of a cash crisis last July, with Bebear heading a new financial panel on the board.
After months of doubts over how the group would look in a year or two's time, Fourtou set out his strategy to shareholders last month, saying Vivendi would focus on music, its cash-rich French telecoms arm Cegetel and French pay-TV unit Canal Plus.
"It was obvious that we had to try to keep Cegetel whatever happened -- it's a formidable cash machine. As for (loss-making) Canal Plus, we didn't really have any other choice than to keep it and clean it up," Bebear said.
He defended Vivendi against criticism that its strategy consists of keeping a trio of broadly disconnected businesses.
"I'd be delighted if there were other strategies. At the (April 29) AGM I didn't hear anyone come along with any staggering ideas on strategy," Bebear said.
With its strategy taking shape, and with VUE on the block and its debts recently refinanced to avoid another cash squeeze, the new-look Vivendi is in no hurry to address the lack of crossover benefits between its three core businesses.
"Either there is a spin-off -- that's one possibility -- or there could be a conglomerate which would nonetheless be limited in scope," Bebear said, on being asked whether Vivendi could split up to shake off a discount seen as afflicting its share price.
"You can't be in too many different businesses. We can have three. There's a choice to be made there, on which Jean-Rene Fourtou has yet to reach a firm conclusion."
LIFE AFTER FOURTOU
At 13.74 euros, Vivendi's share price is up 48 percent from last year's lows but has been limited by a routine holding company discount as well as lingering uncertainty over upcoming asset sales. Its performance is in line with the European media sector this year.
Bebear, who has repeatedly denied pulling the strings in French capitalism or at Vivendi in particular, tried to dampen concerns that Fourtou's decision to retire again at the end of next year would usher in a new period of uncertainty.
Bebear was among those who persuaded Fourtou to come out from semi-retirement as vice- chairman of drugs firm Aventis to replace Messier when Vivendi's banks closed in last summer.
"When he (Fourtou) said he was giving himself two years that didn't mean 'after me, anything can happen'. If in two years Vivendi decides to remain a conglomerate, then it will have a CEO. If there's a spin-off, there's a spin-off."
Bebear also defended Vivendi's decision to award Fourtou a million stock options at 12.10 euros last October. The move emerged in a filing in recent weeks. Messier had come under continuous fire at the end of his career over share options.
"They were granted to him with the company in the state in which he found it. They are blocked for four years," he said.
"If in four years he has turned the company round he will earn money. If he doesn't, he won't."
Copyright 2003, Reuters News Service