Gallic conglom gets Euro shares valued at $725 mil
PARIS — In a flurry of deals Friday, Vivendi Universal said it will sell its 55% stake in AOL France back to AOL Time Warner as the U.S. media giant looked to take full control of its European operations.In exchange, Vivendi gets a lump of preferred stock in larger portal AOL Europe. The shares, valued at $725 million, pay a 6% dividend through April 2003, when AOL Time Warner will redeem them with cash or stock. The preferred shares can also be swapped for publicly traded AOL Europe stock if and when the unit, now owned 50-50 by AOL and Germany’s Bertelsmann, goes public. AOL also plans to buy out Bertelsmann’s stake. AOL France, created in March 1996, has about 1 million subscribers. It has been 55% owned by Vivendi’s Cegetel and Canal Plus divisions. Vivendi will realize a $575 million one-time gain on the sale, having paid about $150 million for its original stake. Two-thirds of the proceeds will go toward telecom group Cegetel. Vivendi has agreed not to launch a rival Internet service provider in France for three years and pledged to spend $25 million to promote its products (mostly from Universal Studios and Universal Music) on America Online and other AOL Time Warner platforms over the next year. The two media companies also struck a number of other cross-promotional deals between AOL France and Canal Plus.