Vivendi Universal aims to reduce its debt by at least Euros12bn within 18 months through a drastic asset disposal plan which includes Canal Plus group's activities outside of France as well the sale of several non-core businesses.
"The Board has noted with satisfaction the decisive progress made during the past three months." VU's chairman Jean-Rene Fourtou stated following a board meeting on September 25. "We are leaving the crisis behind us. The main sources of loss have been reduced, sold or halted, or are about to be. "
The cash-strapped giant, which has secured a Euros3bn medium-term credit line, has already sold off some Euros2bn worth of assets and is hoping to raise Euros5bn within nine months.
Canal Plus has been identified as one of these 'major sources of loss' and the pay-TV group is to be streamlined down to its French operations. In fact, the offloading process has already started, with the sale this week of both Canal Plus' Technologies (to Thomson Multimedia) and Telepiu (to Rupert Murdoch's News Corp for). Canal Plus' other non-French broadcasting operation in Scandinavia (in the process of being sold to Telenor), Benelux and Poland will come next.
Canal Plus French activities (including the pay-TV operator's stake in digital satellite platform CanalSatellite and in cable and satellite channels operator MultiThematiques will be folded back within Canal SA, which operates the French pay-TV channel).
The fate of other Canal Plus subsidiaries such as television production house Expand and film production and distribution outfit StudioCanal is not yet known. It is, however, highly likely that the latter, which owns a 5,500 title-strong film library (a major asset for a broadcasting group), would be sold peacemeal.
Selling off Universal is not on Fourtou's agenda as of yet: "(entertainment) is a market in which Vivendi Universal is already among the world leaders." he stressed in a statement. "To meet that challenge, our objective is to create a true partnership, on both sides of the Atlantic, with the senior executives and talented employees that are the key to these businesses. The partnership will be based on financial agreements and management methods."
Vivendi Universal's next major divestment will be its press and publishing subsidiary VU Publishing (worth between Euros4bn and Euros5bn)for which several candidates are already lined-up.