Bid deadline on Scifi channel, etc was TODAY.

[db11]

Just thought I'd pass some information along, the good and the bad. The good news is that Vivendi set today, June 23rd, as the final date to accept bids on their US entertainment assets. But now, some bad news is that Viacom apparently did not submit a bid after learning it was an all-or-nothing deal. Here are two stories, one is a week old, the other from today:

http://biz.yahoo.com/rf/030616/media_vivendi_deadline_1.html

http://biz.yahoo.com/rb/030623/media_vivendi_10.html

[Dominar of Action]

While Viacom was not expected to make a first-round bid, sources said the company could come back later in the process.Don't count them out just yet ;)

[db11]

I hope that turns out to be the case. It seems they are largely interested only in Scifi, and a $10-15B price tag might be more than they're willing to pay for the only asset they're really interested in. Of course, they could also cut a deal with the eventual buyer just for SciFi, or they could buy it all and sell off parts later. The good news in that regard is that they are probably the 2nd richest potential buyer behind GE, and could probably afford to buy the whole thing and sit on it while they sell off the parts they don't want. Here's hoping they get involved very soon, as Vivendi has some big meeting scheduled for July 1st to discuss this sale.

[vhsiv]

They clearly don't want to pay 'truffle' prices to get a 'plum'. Make 'em sweat!

[Dominar of Action]

I don't doubt there's some gamesmanship involved. I noticed that in one of the late reports yesterday (sorry, can't remember which), a Vivendi source said they would still accept bids for a few more days. Since Viacom is the only other potential bidder out there that we know of, I wonder if Vivendi isn't trying to entice V into the game this early.

[vhsiv]

I was thinking about this later this a.m. - Viacom may want to stand aside and 'let the crowd pass', as it were. Like Ebay gamesmanship, they may only choose to get into the bidding at the 11th hour, and offer some financing to some deeply embroiled bidder in exchange for SciFi on the back-end.

And they are one of the 300-pound gorillas...

[generic_screenname]

It's amazing how interesting and exciting all of this stuff is; the business and politics behind it all. I never knew much about all the deals that go on, nor did I care. But now I check the papers all the time. The Henson deal, the selling of Vivendi's assets, is Viacom in or out...I can't wait to read the business page tomorrow.

[Digger]

From today's Hollywood Reporter....

VU studies bids for showbiz ops

By Georg Szalai
NEW YORK -- With a handful of offers for Vivendi Universal's U.S. entertainment assets submitted by the noon deadline, the media conglomerate's banking and legal teams Monday began a weeklong initial evaluation of the bids, sources said.

Of the six main contenders left before the deadline, Viacom Inc. declined to make an offer. Sources said the company did not even participate in recent management presentations where Vivendi Uni executives shared financial and operational details with potential bidders.

"(Viacom) is really only interested in the Sci Fi (cable) network, and so interest wasn't particularly high," one source said. Vivendi Uni has signaled that it would prefer to sell all of Vivendi Universal Entertainment in one piece. A Viacom spokeswoman declined comment.

Sources, however, said the conglomerate would be ready to make a bid for Sci Fi Channel down the road should Vivendi Uni not sell the asset to another contender.

Sources close to the process said oil billionaire Marvin Davis, John Malone's Liberty Media and a consortium around Edgar Bronfman Jr. submitted bids -- as expected -- for the broader Vivendi Uni entertainment properties by Monday's deadline. Spokespeople for the three bidders did not comment.

Liberty has expressed no interest in Universal Music Group, but Bronfman did include that unit in his offer, according to one source. Davis also was believed to have bid for UMG.

Meanwhile, General Electric's NBC unit handed in "a letter of interest" to Vivendi Uni, according to one source. NBC officials declined comment Monday, and it remains unclear whether the TV giant has submitted a full-fledged offer. According to one source, the other bidders submitted nonbinding bid letters, which are more formal in nature than a "letter of interest."

Industry observers have said that while NBC initially seemed mainly interested in Vivendi Uni's cable TV networks USA and Sci Fi, the company has been warming to the idea of making a broader play to move into Hollywood.

MGM, which has been the dark horse in the bidding process, also was believed to have made an offer for Vivendi Uni's entertainment assets. Company officials declined comment.

A spokeswoman for Vivendi Uni said Monday that the conglomerate was "very happy" with the level of interest and the bidding process but declined comment on specifics.

Vivendi Uni's financial advisers will now sift through all of the bids and evaluate their financial and legal impact on the company, according to sources familiar with the process.

By a board meeting on or around June 30, they will make recommendations to Vivendi Uni management, which will then discuss them at the meeting. An alternative option to a VUE sale to be discussed at the meeting is an initial public offering that management has been preparing in case it receives unsatisfactory bids.

Bidders expect Vivendi Uni to narrow down the contenders to a shortlist at the board meeting and then hold final talks with them before making a final decision. However, one source familiar with Vivendi Uni's thinking said the bidders may not necessarily be narrowed down, or at least not at the next board meeting.

Either way, a final decision is likely still several weeks away, sources said.

Analysts have estimated that Vivendi Uni could fetch $12 billion-$14 billion for VUE. But some warn that the conglomerate will not get all that money for itself.

"Assuming an offer of €10.4 billion ($12 billion) for 100% of the entertainment assets and accounting for the weakening euro-dollar exchange rate and large minorities (including certain tax obligations that might be triggered), Vivendi Uni would actually receive less than €9.2 billion ($10.6 billion), compared with our current valuation (of) €9.7 billion ($11.2 billion)," UBS analyst Mike Hilton said.

In Paris trading Monday, Vivendi Uni shares closed down 3.6% at 16.10. In New York, American depository shares fell 3.5% to 18.55.
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There are some odd things in this report. The quote about Viacom making a bid on SciFi if it is not sold to another contender is very confusing. I couldn't imagine Vivendi selling everything EXCEPT skiffy, and Viacom surely knows that wouldn't happen, so why was this comment made? And the comment about Viacom not even participating in the management presentations is odd too. These presentations were made BEFORE Vivendi announced that they would accept bids only for all the assets and not individual pieces. Why would Viacom not participate then? What game are they playing? Have they been in talks with one or more of the other bidders (there were rumours of a possible Viacom-Liberty joint bid just last week)? I just can't see Sumner Redstone walking away from something he wants, and Viacom keeps saying it wants skiffy.

Another odd thing is that at least 2 of the 5 bids included the music business, and Vivendi had been saying for some time now they weren't selling it.

My interpretation is that there are some serious back room negotiations going on. This whole situation may become even more muddled in the next few weeks before anything becomes clear. And even when it appears clear there may be more going on behind the scenes than meets the eye.

*********************
Oh, and I was watching CNBC last night and happened to catch an interview with our pal Barry Diller. It wasn't easy to watch, considering the two people interviewing him (Krudlow and Cramer?) were so fawning it made me physically ill. They seemed to think Barry was the greatest thing since sliced bread. Ugh. Anyway, there wasn't much to it. They asked about Vivendi and Barry said he was not bidding but that the agrement he had with Vivendi would certainly effect the sale (tell us something new Barry). When asked who he thought was the frontrunner (and Liberty was mentioned specifically) Barry went into obfuscation overdrive. He said a lot of words, but what they all boiled down to were "I'm not talking". He did look a little like the cat that ate the canary during the entire interview, but even moreso when tallking about John Malone and Liberty. All in all the interview told me nothing I hadn't already heard, which isn't a surprise.

[grinner]

Viacom stays out of Vivendi assets bidBy Tim Burt in London and Martin Arnold in ParisPublished: June 23 2003 18:48 | Last Updated: June 23 2003 18:48

Viacom, the world's largest media group, on Monday stayed out of the bidding for US entertainment assets of Vivendi Universal, the French media and telecommunications company.
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The US media group, which includes CBS television, MTV and Paramount studios, decided not to submit a preliminary offer for Vivendi Universal Entertainment, amid signs that VUE's French parent was reluctant to break up the movie studio, theme parks and cable TV joint venture.

Five other bidders - General Electric, Liberty Media, MGM Studios and two financial consortiums - are thought to have submitted non-binding offers valuing VUE at $12bn-$13bn.

The two consortiums - led by Marvin Davis, the oil billionaire, and Edgar Bronfman junior, the Vivendi board member - have also expressed an interest in seeking control of Universal Music and Vivendi's games business. Unlike the trade bidders, both groups plan to create a new entertainment group in which Vivendi would retain a substantial minority holding, pending a future initial public offering.

Their offers included detailed financing letters and proposals to satisfy potential antitrust risks. Vivendi declined to comment on the progress of the auction yesterday.

A source close to the company, however, said Monday's deadline was "flexible" and bids received after it expired "could still be considered".

Viacom, which is only interested in Vivendi's USA and Sci-Fi cable channels, could submit a proposal later if the French group fails to secure a satisfactory bid and instead breaks up the business. Viacom refused to comment.

Citigroup is advising Vivendi Universal on the disposal, assisted by Goldman Sachs.