Exec vows 'no radical surgery' for studio, NBC
Smiling, relaxed and tie-less, Bob Wright, wended his way through a succession of meet-and-greet sessions at Universal Wednesday, assuring everyone that General Electric would prove to be a beneficent proprietor.
The GE vice chairman also pointed out that no actions would be taken at the studio for at least a couple of months while antitrust hurdles are cleared, that he feels confident an accomodation woth Barry Diller will be reached soon and that he has great confidence in the management and growth potential of Universal’s movie studio.
As he made his rounds, giving two talks before studio executives and then dealing with questions from the press, Wright was keenly aware of a sense of déjà vu. Universal employees, after all, had witnessed similar meet-and-greets in recent years, first with the Japanese, then the Bronfmans, then the French and now GE.
Indeed precisely 17 years earlier Wright himself had visited Universal when he became NBC’s new president and had addresses executives on the identical sound stage (NBC’s principal TV supplier at the time was the Universal of Lew Wasserman and Sid Sheinberg). At the time Wrigth assured NBC and Universal employees there would be “no radical surgery” and also refuted comments in some newspapers that the network TV business had “peaked.”
The same assertion appeared this week relative to the formation of the new $42 billion entity called NBC Universal, an Wright was equally dismissive of the notion that either movies or TV had seen their best days.
Accompanying Wright on the initiation tour were prexy of Universal Ron Meyer, NBC Entertainment chief Jeff Zucker and Jean-Bernard Levy, Vivendi’s chief operating officer.
Universal employees were loath to reveal their reaction to Wright’s assurances. “At least these guys are in the entertainment business, not the water business,” one studio exec said, alluding GE’s French predecessors.
Wright’s address revealed “a refreshing absence of hubris,” said another.
Some of the employee questions predictably involved potential layoffs and cost cutting. Wright, whose style has always been one of candor, said the businesses complemented one another and that he anticipated that the consolidations would produce new revenues rather than cut jobs.
On the other hand, he did not dismiss speculation that discussions would take place shortly about ownership of the theme parks.
As to negotiations with Diller, Wright said he felt there was a probability that Diller would exchange his interest in the company for cash or for “something else he can use.”
Wright also expressed confidence in the stability of his newly acquired movie studio and minimized talk of the supposed “volatility” of the business. “Movies are evergreen” he stressed. “They’re pivotal to a company such as ours. They’ll always be a big part of the overall value. Besides, this studio has excellent management.”
Investors seemed to buy the concept, at least at this point. Having gained 8% on Tuesday, the stock got another 35¢ (2%) boost Wednesday from relieved Viv U investors to reach $18.60, its highest level in recent months. GE also continued its market-beating rally, adding another 2.4% (75¢) to close at $31.18, near its 52-week high.
(Meredith Amdur in New York contributed to this report.)