Vivendi's Messier Pressured to Resign
Vivendi's Messier Pressured to Resign
Jul. 01, 2002
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PARIS (AP) _ Jean-Marie Messier, who turned a French water utility into media behemoth Vivendi Universal, was on the verge of resignation Monday amid pressure from board members angered with the company's slumping fortunes, a French newspaper reported.
The flamboyant Messier, whose departure as chairman has been anticipated since Vivendi Universal shares tumbled to 13-year lows recently, has agreed to resign, Le Monde newspaper reported. Company officials declined to comment.
``There will be no official announcement today,'' Vivendi spokeswoman Agnes Vetillard told The Associated Press outside its Paris headquarters. She also denied earlier French news reports that said the company's board was meeting on Monday.
Vivendi's stock surged on Monday after reports came out indicating that Messier was about to step aside. The shares were up 92 cents or 4 percent at $22.42 in afternoon trading on the New York Stock Exchange.
Messier, who shook up the French establishment with his vision of U.S.-style corporate management at Vivendi, made a foe of its top shareholder _ the Bronfman family _ which strongly backed his vision only two years earlier.
But the daring buyout spree led by Messier to create one of the world's biggest media companies covering film, music, television and mobile phone networks eventually saddled Vivendi with huge debts and caused the once high-flying company to fall out of investor favor.
Last week Messier lost a key ally when Bernard Arnault, the chief of luxury goods company LVMH Moet Hennessy Louis Vuitton, quit Vivendi's board, deepening concerns about Messier's tenure.
In a last-ditch effort to save his job on Sunday, Messier tried to convince the company's European board members _ his former allies _ to let him stay before agreeing to step down, Le Monde reported.
The report said the board was expected to name Jean-Rene Fourtou, vice-chairman of the supervisory board of French-German pharmaceutical giant Aventis, for a six-month interim chairmanship.
Another French newspaper, Liberation, said Vivendi Universal's European directors had lost confidence in his ability to reverse the company's fortunes and had asked him to leave.
Last week they supported Messier at a board meeting when the North American directors demanded his resignation. However, the European board members met this weekend and decided to withdraw their support, Liberation reported.
Members of the Bronfman family, who own about 5 percent of Vivendi stock, are reportedly angry that Messier wasn't removed by the board of directors last week.
If Fourtou (pronounced for-TOO) replaces Messier, he is expected to push for a restructuring of the conglomerate, breaking it down into more manageable parts. A breakdown would signal the demise of Messier's dream of a global company capable of delivering movies and music to consumers via televisions and mobile phones.
Vivendi Universal, Messier's brainchild, was born of the merger of Vivendi, Canal Plus TV and film studios, and Canada's Seagram _ the owner of Universal Studios and Universal Music.
The plan has failed to live up to expectations. Investors, once impressed with Messier's vision, have grown nervous about his ability to meld together the company's diverse businesses and reduce its borrowings. Vivendi's shares have fallen nearly 70 percent this year.
Even though it's now one of the world's biggest media companies, Vivendi Universal has its roots in water and spirits businesses.
Messier took the helm of the former French water utility Compagnie Generale des Eaux _ General Water Company _ in 1996, and re-christened it Vivendi two years later. Canada's Seagram was a liquor company for generations, and acquired the Universal music and film properties in the late 1990s.
The anticipated fall of Messier would mark a sharp turnaround since 95 percent of shareholders in the French predecessor voted to approve the multi-billion dollar deal to create Vivendi Universal just 19 months ago.
At that time, celebrating the vote, Messier held his hand high with his fingers in the form of a ``V,'' which would later become the company's prestigious one-letter ticker symbol on the New York Stock Exchange.