New Vivendi Chairman Touts Synergies, 'Hidden Value'
LONDON – New Vivendi chairman Vincent Bollore, the French billionaire who owns a 5 percent stake in the conglomerate, on Tuesday signaled his hope for improved cooperation and synergy across the company's operations.
Bollore spoke at Vivendi's annual shareholder meeting in Paris, which was webcast.
Following $30 billion in asset sales, including a deal to divest French telecom arm SFR late this year, Vivendi will focus on its media and entertainment operations. Its key businesses are Universal Music Group, French pay TV firm Canal Plus and Brazilian broadband firm GVT.
"I have a clear strategy," Bollore told the annual meeting. "The idea is to transform this financial holding [company] into a real integrated group with a focus on content." He added: "There is hidden value…it is in convergence, in the synergies we can [reach]."
He said his goals for the company were "ambitious" because the media industry was "in the throes of change" and there are bigger foreign competitors.
Outgoing chairman Jean-Rene Fourtou has been asked to serve as honorary president of Vivendi and advise on the closer integration of units, the company said Tuesday.
After asset sales, Vivendi is "in a strong position to embark on a new stage of growth," Fourtou said at the meeting. "The digital revolution creates multiple opportunities."
He called Bollore "an entrepreneurial, imaginative, tenacious industrialist" who "has ambitions for this group" and has a keen feeling for the interests of shareholders.
Asked by a shareholder about his executive pay, Bollore vowed to be conscious of excessive pay, saying: "I will be modest."
While observers expect Vivendi to look for acquisitions, Bollore didn't immediately signal what assets he was interested in. "The board will decide the dividend policy based on what opportunities are available," he said in one reference to possible deals. "In a growing business, and we think our media activities will grow, it seems reasonable to distribute 40 to 50 percent."
Vivendi management on Tuesday also got shareholder questions about Netflix's upcoming launch in France and the decision to sell its stake in video game maker Activision Blizzard.
"The way we are preparing for the launch of Netflix is to develop very attractive content offerings," such as via [VOD service] CanalPlay, which already has 450,000 subscribers, said Canal Plus Group chairman Bertrand Meheut after a question about Netflix's pending launch in France and other European markets. "The Netflix catalog will not contain more recent movies. We have key assets."
He added though: "Of course, we must take the arrival of Netflix very seriously. We are relatively confident."
Fourtou on Tuesday also admitted that he was glad about the Activision divestiture given concerns about the effects of shooting games, such as the company's Call of Duty franchise. "They are on the cutting-edge of technology…They are a jewel," he said. "When we decided to focus on content and we had to reduce debt, the board decided that the priority would be to exit."
He added: "Activision Blizzard's business activity is based mainly on two games - World of Warcraft and Call of Duty, so it was fragile. When we bought Activision Blizzard, we very much believed in Guitar Hero, which was booming But within six months, it basically vanished." And, he argued, that "every single time there were massacres in Sweden, Norway, the United States, the killers were people who had been spending a lot of time playing those two games, especially Call of Duty."
Concluded Fourtou: "Supervisory board members just as you felt it was really a problem having this kind of business activity in our company."
Among other executives in attendance at the meeting Tuesday was Universal Music chairman and CEO Lucian Grainge.