Against the background of French newspaper reports suggesting that its Canal Plus division will now be broken up, Vivendi Universal and former chairman Jean-Marie Messier are to be sued by a group of US investors.

The investors, operating under the banner Rosenbaum Partners, bought shares between February and July of this year and allege that the company attempted to hide the true state of its financial crisis. "Messier orchestrated a scheme to conceal the severity of Vivendi's liquidity problems stemming from the massive debt load," the suit claims.

Late last week the company announced that it would delay publication of its quarterly financial results, originally scheduled for this Friday (July 26). That came a few days after the French stock-market regulator, the COB, announced that it was investigating the company's accounting practices. Both Vivendi Universal and the COB have said that this is the kind of routine investigation that is made into some 90 quoted firms a year.

Le Figaro newspaper today (July 22) claimed that new chairman and chief executive Jean-Rene Fourtou is to oversee the break-up of the Canal Plus Group, the pay-TV and film division. Profitable channels will be retained by Vivendi Universal, but film production and distribution as well as many other international operations would be sold.

"Canal Plus will remain part of Vivendi Universal, confirming the group's media-focused strategy, but Canal Plus will cease to exist in its current shape. All the operations of Canal Plus Distribution are up for sale," the newspaper reported.

Also on sale will be Canal Plus subsidiaries in Spain, Poland and Belgium as well as cinema and audiovisual production house StudioCanal, film distribution arm UGC, decoder manufacturer Canal Plus Technologies and its new media and internet activities, the paper said.

Fourtou is expected to make presentations on the future shape of the group today and tomorrow to the boards of directors and to the TV regulator the CSA. It has so far made no public comment since the Figaro report.