EU To Rule on Vivendi-Seagram Deal
Friday, October 13th 2000, 12:00 am
By: News On 6
BRUSSELS, Belgium (AP) â€” European regulators were to decide Friday whether to clear the $30 billion media deal between France's Vivendi and Canada's Seagram Co. or order an in-depth probe into their proposed merger.
The deal would bring together Vivendi's European cable TV, satellite and Internet distribution systems and Seagram's Universal music and movie studios to create a global media conglomerate called Vivendi Universal.
In Paris, Vivendi told analysts it could sell its 20 percent stake in British satellite TV group British Sky Broadcasting Group, a unit of Rupert Murdoch's News Corp. Analysts perceived that move as a concession to gain EU approval.
A decision from the EU antitrust authorities had been expected last July, but the regulators deferred while the companies allayed concerns that Vivendi's pay-television unit, Canal Plus, would have unfettered access films produced by Universal Studios.
The deal has been cleared in the United States by the Federal Trade Commission. It has also passed one of the three regulatory bodies it needs to pass in Canada and French regulators have also given their consent.
Shareholders from Vivendi, Canal Plus and Seagram must also sign off on the deal, but those meetings have not yet been set.
Friday was the deadline for the European Commission to either clear the merger or launch a more in-depth probe into impact that the deal would have on fair competition in the 15-nation European Union.
Vivendi has been moving well beyond its core businesses of water treatment and construction in recent years, building up its media portfolio by buying the Havas publishing group and stakes in BSkyB, the satellite TV company, and AOL France.
It half-owns Canal Plus, a major European cable TV company that will join the new Paris-based conglomerate.
Seagram has also been moving beyond its roots as a liquor company under the guidance of Edgar Bronfman Jr., grandson of the company's founder. Bronfman bought Universal Studio's parent MCA from Matsushita Electric Industrial Co. of Japan in 1995, and the Polygram music company from Phillips Electronics in 1998.
Seagram's liquor business, built up over three generations in the Bronfman family, will be sold off.
The new company will offer movies, TV programming, music, sports, games and educational and professional information via digital and analog formats.