Vivendi to list stock/utilities unit on NYSE:February 25, 2000
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France's Vivendi to List Its Stock,
Shares of Utilities Unit on NYSE
By AMY BARRETT
Staff Reporter of THE WALL STREET JOURNAL
PARIS -- Vivendi SA will list its shares on the New York Stock Exchange by the end of the year after listing its utilities branch there separately in an effort to simplify the group's structure, Chief Executive Jean-Marie Messier said.
In an interview, Mr. Messier said Vivendi has no intention of getting out of the utilities business. Recent asset sales by Vivendi's utilities branch have been interpreted by market observers as preludes to an outright sale of the branch so that Vivendi could focus on its fast-growing communications activities. These include fixed-line and mobile telephone service, publishing, video games, multimedia and pay-television interests.
The initial public offering of the utilities branch, called Vivendi Environment, will take the form of a capital increase, with Vivendi retaining a stake of 60% to 70% of the unit, Mr. Messier said. Vivendi's utilities operations include water, waste treatment and energy services. The IPO will take place "around summertime" of this year, he said. The listing of the parent will follow before the end of the year.
Changing Public Perception
The objective of separate listings is twofold: to allow the utilities operations to finance their own development through capital markets and to change the public perception of Vivendi as an opaque conglomerate, a view that has hurt the company's share price in relative terms.
While Vivendi's share price has grown by 35% since Jan. 1, shares of Canal Plus SA, its 49%-owned pay-TV subsidiary, have risen 72% so far this year.
"This will clarify things for the shareholder whose investment priority is communications," Mr. Messier said. "This is the final stage of Vivendi's restructuring, allowing us to answer shareholders' legitimate questions without giving in to fashion."
Financing new growth opportunities in media and telecommunications won't be a problem following the finalization, expected in mid-March, of recent deals to shed assets of U.S. energy subsidiary, Sithe Energies Inc., from which Vivendi expects a capital gain of $450 million, and of property group CGIS. Once those deals are done, "the communications branch will have assets worth 60 billion euros [$60.2 billion], with no debt," Mr. Messier said. "That gives us some leverage to act."
Joint Venture With Vodafone
Even before those sales, Vivendi has been charging ahead with new communications moves, notably last month's announcement of a joint venture with Vodafone AirTouch PLC to create a Europewide multiaccess Internet portal, accessible by cellular phone, television or computer. Mr. Messier said the venture, called MAP, will be off the ground by June 30.
By that date, MAP's portal will automatically become the default home page for all 80 million subscribers to Vivendi and Vodafone's combined mobile-phone and Canal Plus's pay-TV services in 15 European countries, he said. Once Vodafone's pending merger with Mannesmann AG is finalized, that subscriber base will grow to 100 million, whereas before the accord with Vodafone, Vivendi had access to only 20 million potential interactive customers, he said.
The idea behind MAP is to provide highly localized, practical services. As an example of the kind of service available to future MAP subscribers, Mr. Messier mentions restaurant listings.
"If I'm at home on my PC and I want to find an Indian restaurant, the computer's going to roll out the whole list. On my mobile, I'll be able to walk out the door of my office, and be told the name and address of the one closest to where I'm standing."
Broadening Content, Reach
With MAP's 80 million subscribers to feed, the priority is now on maintaining and building Vivendi's strength as a content provider in sports, cinema, education, computer games and health. This could be done either through alliances or acquisitions, Mr. Messier said.
The other goal is to broaden Vivendi's global reach. Its book and multimedia publisher, Havas, is already the world's No. 2 in English-language educational media, and by the end of this year Vivendi will launch an educational Web portal, education.com, in the U.S., United Kingdom, Spain, France and Germany.
"For the moment it's the clear priority," Mr. Messier said. "But Vivendi Communication is not eternally wedded to Europe alone."
Write to Amy Barrett at amy.barrett@wsj.com |
