Vivendi

Vivendi SA

Company type	Public (Euronext: VIV)
ISIN	FR0000127771
Industry	Media
Founded	3 way merger between Vivendi, Canal+ and Seagram (2000)
Headquarters	Paris , France
Key people	Jean-Bernard Lévy, Chairman & CEO Jacques Espinasse, CFO
Products	Music, film, publishing, pay TV services, programming
Revenue	€20.044 billion (2006)
Operating income	847,000,000 Euro (2023)
Net income	€4.033 Billion (2006)
Number of employees	34,031 (2005)
Subsidiaries	Canal+ Group Universal Music Group Vivendi Games NBC Universal (20%)
Website	www.vivendi.com

Vivendi SA (formerly known as Vivendi Universal) is a French media conglomerate with activities in music, television and film, publishing, telecommunications, the Internet as well as video games.

The company disclosed a corporate loss of €23.3 billion in its 2002 annual report, the worst loss to date for a French company. Amid intense media scrutiny, its chairman and CEO, Jean-Marie Messier (who had overseen the most dramatic phase of the company's diversification), was subsequently replaced by Jean-René Fourtou.

Messier's rapid expansion of the firm, during which he overpaid hugely for media assets, saddling the company with debt far in excess of its market valuation and ultimately bringing it to the brink of collapse, has become a study in the triumph of personal ambition for greed and power over common sense.

History

On December 14, 1853, a water company named Compagnie Générale des Eaux (CGE) was created by an Imperial decree of Napoleon III. In 1854, CGE obtained a concession in order to supply water to the public in Lyon, serving in this capacity for over a hundred years. In 1861, it obtained a 50-year concession with the City of Paris.

For more than a century, Compagnie Générale des Eaux remained largely focused on the water sector. However, following the appointment of Guy Dejouany as CEO in 1976, CGE extended its activities into other sectors with a series of takeovers. Beginning in 1980, CGE began diversifying its operations from water into waste management, energy, transport services, and construction and property. It acquired the Compagnie Générale d'Entreprises Automobiles (CGEA), specialized in industrial vehicles, which was later divided into two branches: Connex and Onyx Environnement. CGE then acquired the Compagnie Générale de Chauffe, and later the Montenay group. The Energy Services division these companies became part of, was later (1998) renamed Dalkia.

In 1983, CGE helped to found Canal+, the first Pay-TV channel in France, and in the 1990s, they began expanding into telecommunications and mass media, especially after Jean-Marie Messier succeeded Guy Dejouany on June 27, 1996. In 1996, CGE created Cegetel to take advantage of the 1998 deregulation of the French telecommunications market, accelerating the move into the media sector which would culminate in the 2000 demerger into Vivendi Universal and Vivendi Environnement (Veolia).

In 1998, Compagnie Générale des Eaux changed its name to Vivendi, and sold off its property and construction divisions the following year. Vivendi went on to acquire stakes in or merge with Maroc Telecom, Havas, Cendant Software, Anaya, and NetHold, a large Continental European pay-TV operator. Beginning in 1998, Vivendi launched digital channels in Italy, Spain, Poland, Scandinavia, Belgium, and the Netherlands.

In June of 1999, Vivendi merged with Pathé, the exchange ratio for the merger fixed at three Vivendi shares for every two Pathé shares. The Wall Street Journal estimated the value of the deal at US$2.59 billion. Following the completion of the merger, Vivendi retained Pathé's interests in British Sky Broadcasting Group PLC and CanalSatellite, a French broadcasting corporation then sold all remaining assets to Jérôme Seydoux's family-owned holding company, Fornier SA who changed its name to Pathé.

In July 2000, Vivendi spun off its water and waste companies - once its core business - along with interests in other public service sectors such as transport into Vivendi Environnement (IPO in Paris in July 2000 and in New York in October 2001), later (2003) renamed Veolia Environnement.

Vivendi Universal Entertainment was created in December of 2000 with the merger of the Vivendi media empire with Canal+ television networks and the acquisition of Universal Studios from Canadian company Seagram.

Vivendi in its current form came into existence on April 20 2006 following the sale of an 80% stake in the Vivendi Universal Entertainment unit to form NBC Universal and the gradual recovery of the company from its disastrous over-expansion in the late 1990s and the early 2000s.

2001

• Vivendi Universal (VU) acquired MP3.com and a leading American publisher, Houghton Mifflin.

2002

• VU began facing financial trouble. It responded with financial reshuffling, trying to shore up media holdings while selling off shares in its spin-off companies.
• Reduced its stake in Vivendi Environnement to 40% and sold its stake in Vinci Construction.
• The flamboyant company's Chairman and CEO, Jean-Marie Messier (who had overseen the most dramatic phase of Vivendi's diversification) resigned. He was replaced by Jean-Rene Fourtou. The company then began reorganizing to stave off bankruptcy. The company announced its strategy to sell non-strategic assets. Its largest single shareholder was the family of Edgar Bronfman, Jr., who was head of Seagram at the time of the merger.
• Sold its stake in Vizzavi to Vodafone, with the exception of Vizzavi France. It also sold 20.4% of Vivendi Environnement's capital to a group of investors, and its stake in North American satellite operator EchoStar Communications Corporation.
• VU sells Houghton Mifflin to Thomas H Lee, Blackstone and Bain consortium for US$1.66bn. [1]

2003

• Sold Canal+ Technologies to Thomson (formerly Thomson Multimédia); Tele+ to News Corporation and Telecom Italia. It also sold its 26.3% interest in Xfera.
• On March 6, Vivendi disclosed its annual report (term ended at December 31,2002), that is downloadable in pdf format on its site. Some highlights include:
  • Corporate loss of €23.3 billion: the worst loss for a French company.
  • Net debt of €12.3 billion
  • Vivendi will sell assets for 7 billons euros in 2003
• On December 1, 2003, Vivendi closed a deal to sell MP3.com to CNET.
• Defying predictions that it would be unable to raise the cash needed, VU bought out one of the two minority shareholders in Cegetel, taking its holding to 60 percent, with Vodafone holding the remaining 40 percent. Management viewed the mobile communications firm as a core asset once the bulk of media assets had been sold off. Vodafone remains keen to add Cegetel to its portfolio and a move to gain control, possibly via a bid for the whole of VU, cannot be ruled out in the future.

2004

• 80 percent of the Vivendi Universal Entertainment branch was sold to GE, forming NBC Universal, with VU retaining a 20 percent stake.
• Sold its interests in Kencell (re-branded Celtel, Kenya), Monaco Telecom and Sportfive (which it held through Canal+ Group).
• Sold Newsworld International to the business partnership of Joel Hyatt and former Vice-President of the United States Al Gore
• VU and Valve Software (makers of Half-Life) went head to head over the distribution of Half-Life 2 to cyber cafés, they later came to an agreement stating:
  • The authority of distributing cyber café licenses are to be handed over to Valve from VUG (and Sierra), and licenses granted by VUG and Sierra to cyber cafés prior to the agreement are revoked.
  • VUG would cease distributing all retail packaged versions of Valve games by August 31, 2005.
• VU bought the rights to the game Redneck Rampage after Interplay's corporate shutdown.

2005

• December 16: it was announced that Canal Plus would merge with TPS, France's second largest Pay-TV provider. If the €5 billion (US$5.9bn; £3.4bn) tie-up is approved, VU will own 85% of the combined entity.

2006

• January 17: Vivendi SA announced that it will end its American Depositary Receipt program and its listing on the New York Stock Exchange by the end of quarter 2 2006, due to lowered trading volume on its shares and high costs. [2]

• April 20: Vivendi announced that shareholders approved a name change. It dropped the "Universal" from its name and will now be known simply as "Vivendi". A new corporate logo was simultaneously unveiled.

• August: Vivendi signed a deal with Spiralfrog to distribute Vivendi's songs online in the United States and Canada.

• September 8: Vivendi announced that Sierra Entertainment, a division of its Vivendi Games group would be publishing the new game for Double Fine Productions, the studio that brought the underground hit Psychonauts. The game which Sierra shall be publishing, is still unknown.

• September: Vivendi has announced to buy BMG Music Publishing, the daughter company of German media conglomerate Bertelsmann for €1.63 billion (US$2.1bn).

Current assets (partial list)

• Canal+ Group;
• Universal Music Group;
• Vivendi Games - 99% (which includes Blizzard Entertainment and Sierra Entertainment);
• NBC Universal - 20% long-term ownership interest;
• SFR - 56%;
• Maroc Telecom - 51%.

See also

• List of French companies
• List of assets owned by Vivendi

External links

• Vivendi.com - Official site
• Vivendi Brazilian Official Site
• Ketupa - Vivendi and Universal extensive profile