Edgar Bronfman Jr. can’t stay out of headlines – or bookstores. The scion of one of the century’s most famous dynasties recently emerged triumphant in a battle to acquire Warner Music. It’s the latest chapter in a controversial career that’s been dissected ad infinitum on Wall Street, in Hollywood and in the press – one that features prominently in two new tomes. “Leo, A Life” is a self-congratulatory autobiography of Bronfman family consigliere Leo Kolber, a savvy moneyman with a chip on his shoulder. “The Man Who Tried To Buy the World: Jean-Marie Messier and Vivendi Universal” is a snappily written, insightful chronicle of the French conglom’s destruction by its megalomaniac former chairman.
“Leo” is a clunky, rather dull read for those not versed in the arcana of Canadian business and politics. Kolber has been a close friend of Edgar Jr.’s uncle Charles Bronfman, who represents the branch of the family distressed by Seagram’s jump into showbiz. He says Edgar Sr. — Charles’ brother and Edgar Jr.’s father — was “obsessed” with his son, whom Kolber describes as “a very nice man, very diffident, a good listener and not a showoff in any sense of the word. He is anything but stupid. But he had no business running Seagram and if he hadn’t been named Bronfman, he wouldn’t have been.”
Kolber ran Cemp Investments, the Bronfman family trust, and its giant real estate arm Cadillac Fairview. He says he also planned their funerals, kept their secrets. His tone towards the Bronfmans is in turn patronizing, affectionate and bitter — at being close to the family but always an outsider.
Kolber recounts Seagram’s early flirtations with Hollywood, starting with Cemp’s purchase in the 1960s of 30% of Paramount. Patriarch Sam Bronfman “went ballistic,” he wrote, and the stake was sold to Gulf & Western’s Charles Bluhdorn. Two years later, Cemp acquired a commanding 15% chunk of MGM, later acquired by Kirk Kerkorian.
“It would have saved us a lot of trouble with Edgar Bronfman Jr. if we had been in the movie business when he wanted to get into it…Ultimately, it might have saved the Seagram empire instead of Hollywood being the root cause of its downfall.”
Yet the company’s downfall, most agree, rested mainly with Edgar Jr.’s unfortunate choice of merger partner – a saga documented up-close and personal by the duo behind “The Man Who Tried to Buy the World,” two journalists based in Paris who reported the story as it unfolded.
Their entertaining book follows the rapid rise of Messier from Paris’ elite schools to stardom in the ministry of economy and finance under Edouard Balladur and then at investment bank Lazard Freres. In 1996, He was named chairman of giant water utility Generale des Eaux, the company he renamed Vivendi and launched on a quest for global media domination.
In an angle often given short shrift by the U.S. press, they explore why the French establishment was so keen to build Messier up, and the almost comical reticence of Vivendi’s French-dominated board of directors who refused to question his strategy or accounting until the situation was dire.
Messier was showered with accolades. “Many depicted him as a symbol of the changing face of French capitalism and of a new, self-confident country liberated from a wearisome complex over its own relative decline,” the authors write. “Messier incarnated ‘la France qui gagne,’ the France that wins.”
He was lauded by philosophers, politicians and businessmen. The French Ambassador to the U.S. called Messier “the prototype of a new breed of French executives that dispels the traditional cliches about France.” Intellectual Bernard Henri-Levy rejoiced in execs like Messier who “take to the high seas because they are fed up with seeing French culture and cinema live in permanent surrender to large American corporations.” Messier later alienated French elites by declaring the so-called French cultural exception “dead.”
Edgar Jr. and his clan found Messier charismatic and compelling. And they wanted to cash out. Messier was looking to make a splash, and find branded content to pipe through Vivendi’s cell phones and its flashy new European Internet portal, Vizzavi.
Bronfman was no stranger to transformation. He became Segram’s CEO in 1994. Almost immediately, he sold its stake in DuPont, bought MCA and renamed it Universal. Two years later, he paid more than $10 billion for music giant PolyGram.
The stock rose. By mid-1999 the Bronfmans decided to cast their chips into the bull market. In 2001, they sold Seagram to Messier’s Vivendi in a rich, all-stock deal valued at more than $40 billion.
Butmany investors weren’t convinced by the combo. The stock shares started slipping, the Internet bubble burst — and Messier turned out to be a pathological shopaholic who saw Vivendi as a “skeleton” that needed fleshing out.
He poured cash into Vizzavi and a host of other ‘Net ventures, made random acquisitions like a stake in Maroc Telecom, and bought publisher Houghton-Mifflin for $2.2 billion.
Johnson and Orange said that if the deals had stopped there, the company might still be one of France’s most powerful.
They didn’t Messier forked out $1.5 billion for a piece of EchoStar. He agreed to buy Universal Televsion back from Barry Diller for triple what Diller paid for it.
Debt ballooned, barely disguised by disingenuous accounting. Messier spent $10 billion surreptitiously buying back shares as the stock cratered – “one of the single most stupid decision ever made by a major European chief executive,” the book said.
Irate, the Bronfmans challenged Messier, an unusual practice on French boards, where directors politely resigned if they differed with the chairman.
Messier, the Americanized champion of the modern French corporation, counted on such old- world reticent. “Messier was sure no French board would adopt crude American tactics and dismiss him.”
His goose was cooked only when Societe Generale and BNP Paribas refused to lend cash-strapped Vivendi a euro unless he resigned, a radical moment in French business history.
But under French law, only Messier could call an unscheduled board meeting, and one was needed to vote for his ouster. He agreed to call a meet — in exchange for $20 million.
“His attitude was, ‘Unless I get my money, I’m not going to call a board meeting,’ said Bronfman. But we couldn’t wait until September. The company would have been gone by then. My view was that, however repugnant it may be to give that cocksucker anything, it was more important to save the company. It was blackmail.”
The cash is currently being held in escrow at the request of the Securities and Exchange Commission. Messier was ejected from his palatial Park Avenue apartment, paid for by Vivendi, which has been split up and sold. Mesier formed a small investment firm, Messier Partners.
“I failed. I start again from scratch. I take my hat and my cane and go see investors,” he said during a press conference for the launch of his second book, Mon Vrai Journal. His side of the story.