With Vivendi Universal topper Jean-Rene Fourtou back in Paris following a whirlwind tour of L.A. and Gotham operations, speculation is building over conglom’s looming announcement on asset sales.
Viv U is expected to announce various strategic decisions after conglom’s Sept. 25 board meeting. Fourtou likely will signal whether or not a breakup of the Vivendi Universal Entertainment unit is in the offing. The betting is that it’s not.
Fourtou visited Universal Studios brass in L.A. on Friday and Saturday after a previous stopover in Gotham.
In Hollywood, he met with Diller, Universal Studios prexy Ron Meyer and Universal Pictures chairwoman Stacey Snider; in Manhattan, he visited Universal Music Group execs including topper Doug Morris.
Bets are Fourtou and company will decide to keep the core entertainment assets intact.
Some investment bankers, however, have been floating a proposal to reduce Viv U’s stake in the entertainment unit to 51%.
It’s also believed VUE chief Barry Diller has been in discussions over the prospective sale of the entertainment unit’s theme park operations. The Blackstone Group is one potential buyer, as the Gotham investment firm already holds a 50% stake in Viv U’s Orlando, Fla. theme park Universal Studios Florida.
Fourtou — who took over from deposed Viv U boss Jean-Marie Messier in July — is also expected to announce the sale of some or all of conglom’s sizable publishing ops, as well as sundry other steps to unload investments in non-core Euro feevees.
“I don’t expect every single asset sale to be flagged,” a conglom insider said Monday. “But I think there will be some telegraphing of what the asset sales will be.”
Viv U has set up several data rooms to accommodate prospective suitors for its publishing businesses, which include the Houghton Mifflin imprint.
Execs have also been working closely with a wide array of lenders in an effort to construct a new financing package for the cash-needy conglom.
Following Street signs
Amid all the behind-the-scenes maneuvering, Viv U insiders also have been watching for signs of how Wall Street is receiving the various trial balloons about possible asset sales.
The prospect of a lucrative publishing selloff helped boost conglom’s languishing shares. But the notion that Viv U’s entertainment assets might be pared down hasn’t helped the stock notably so far.
Many predict a continued go-slow approach toward asset sales as long as Viv U shares trade well below their 52-week average and biz valuations remain stuck at relative lows.
“I think they’re going to avoid selling as much as they can with valuations so low right now,” observed David Davis, senior veep at Houlihan, Lokey, Howard & Zukin in Los Angeles.
Viv U shares fell 17¢, or 1%, to $12.95 on Monday.
Exec shuffle continues
Meanwhile, an exec shuffle continues to take shape in the post-Messier era at Viv U’s French headquarters.
Canal Plus Group is poised to get a new chief operating officer — from the world of pesticides — as Fourtou seeks to weed out the ailing from the profitable among Viv U’s French media assets.
The appointment’s not official yet, but Bertrand Meheut — a Fourtou confidant and ex-chief of pharmaceutical giant Aventis’ agrochemicals subsid — will likely succeed incumbent Jean-Laurent Nabet.
Further speculation sees other Messier nominees similarly displaced by Fourtou recruits, with Canal Plus topper and Messier appointee Xavier Couture scrambling to preserve his own tenuous position. Formerjournalist Martine Esquirou ankled as Canal Plus Group communications head on Friday.
The shakeups underscore Fourtou’s attempt at making his mark upon the media conglom, while slashing Messier’s $19 billion debt legacy. Fourtou has pledged to sell loss-making units such as the Italian satellite platform Telepiu and float what was left on the stock market.
Open to feevee offers
More recently, Fourtou has suggested he would be open to offers on certain other parts of the conglom’s large Canal Plus feevee holdings.
Expand, the TV arm of production entity Studio Canal, could be among the assets marked for sale, and Canal Plus staffers expect word today that Viv U will sell Canal Plus Technologies to Thomson Multimedia in a $200 million deal.
France’s Lagardere unveiled a bid for Vivendi Universal Publishing’s Gallic assets Monday. The company owns Hachette Filipacchi, the world’s biggest magazine publisher whose titles include Elle, Car and Driver and the flagship French weekly Paris Match.
“French culture deserves our interest,” Lagardere Media chief Arnaud Lagardere said at a news conference.
He nixed speculation Lagardere might trade its stakes in subsids Canal Satellite (34%) and Multithematiques (27%) for a smaller interest in a restructured, publicly quoted Canal Plus Group.
Lagardere, which also has interests in aerospace, offered Viv U and the country’s establishment a way of keeping Larousse and other famous titles French.
“We will submit a bid to Vivendi Universal for the French activities of Vivendi Universal Publishing,” said Lagardere. “Our intention is not to make a financial killing but to keep the entirety of the activities for the very long term.”
(Reuters contributed to this report.)