Viv U adieu to AOL France

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.

Want to read more articles like this one? SUBSCRIBE TO VARIETY TODAY.
Post A Comment 0

Leave a Reply

No Comments

Comments are moderated. They may be edited for clarity and reprinting in whole or in part in Variety publications.

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

More Digital News from Variety

Loading