...ce n'est pas la guerre

7 March 2003

It certainly is not. Without asset sales, its debts are set to rise by a half in 2003. Meanwhile, its businesses are in rotten shape. Yet management is still valiantly trying to kid the buyers of those assets that it is not a distressed seller. C’est magnifique, mais…

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Vivendi Universal has "not yet fully emerged from its crisis" of 2002, JeanRene Fourtou, the conglomerate's chief executive, said, announcing results for the year. He told investors that the group was not targeting the shortterm share price, but was aiming to deliver value for shareholders over a twoyear time horizon. According to Fourtou, the group "could not be seen as a coherent company", consisting as it did of a "basket of businesses" with very little synergy between them. He saw his task as managing a disposals process which would involve a further E7bn of asset sales in 2003, aimed at choosing the businesses that would create value for shareholders in the future. That task, said Fourtou, was "not easy".

On a proforma basis taking account of the major acquisitions that began 2002 and the disposals that concluded it, Vivendi's revenues were up 4% and its operating income fell 4%. For the group's six fullyconsolidated businesses, operating income rose 18%, virtually all of which was attributable to telecoms subsidiary Cegetel.

Vivendi closed 2002 with net debt of E12.3bn. On 28th February, it had gross cash of E2.3bn and available liquidity of E4bn. It expects to make asset sales worth E7bn during 2003, which would produce a forecast net debt at the end of the year of E11bn.

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