Viv U game revamp

Hack takes over for Cron atop struggling unit

Vivendi Universal is shaking up its struggling vidgame unit.

Bruce Hack, lead negotiator in the sale of Viv U’s entertainment assets to NBC, is taking over as CEO of VU Games, replacing former head and Universal Entertainment chief operating officer Ken Cron, who ankled.

Joining Hack as chairman is Rene Penisson, most recently a senior adviser to Viv U CEO Jean-Rene Fortou. Both will work out of VU Games’ Los Angeles headquarters.

The presence of two execs with no background in the vidgame industry but experience with corporate deals and close ties to Fortou increases speculation that Viv U may be looking to offload its poorly performing games unit, which saw its revenue fall more than 50% in the third quarter of 2003 and predicted similarly depressed numbers for Q4. Company said at the time that it was in the midst of reorganizing VU Games, a process that has included the consolidation of operations from its various labels and an undisclosed number of layoffs in the past few months.

The French media reported that Viv U was offered between $700 million and $900 million by an unnamed buyer in the gaming industry this past fall for VU Games — a deal it turned down, hoping to receive at least $1 billion.

Besides its film and TV assets, Vivendi has also unloaded a number of its interactive properties in the past six months, including online gaming company Flipside, formerly headed by Cron, and music Web site MP3.com.

In a statement, however, Fortou said he plans to grow the gaming division under its new leadership. “There is tremendous growth potential at VU Games,” he said. “Under the new leadership team, Vivendi Universal intends to grow this business aggressively.”

VU Games does have a number of potentially lucrative titles lined up for 2004, including a massively multiplayer online version of its “Warcraft” series, sequels to its hit “Crash Bandicoot” and “Half-Life” titles, and a game based on upcoming U action pic “Van Helsing.” The gaming unit, which includes labels such as Blizzard Entertainment, Sierra Interactive and Fox Interactive, maintains a first-look deal with Universal Pictures.

(Meredith Amdur contributed to this report.)

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