Media: Vivendi Weighs IPO for Portion Of Entertainment Businesses
PARIS -- Vivendi Universal SA said it was considering an initial public offering of 25% to 30% of its U.S. entertainment businesses because of the rebound in stock prices, putting bidders looking at the assets on notice that it has other options should their offers be too low.</br></br>Vivendi raised the possibility of an IPO as it reported first-quarter earnings that showed declines at both its Universal Music Group unit and the U.S. television and film businesses it is auctioning.</br></br>Despite the weaker entertainment-business results, Vivendi's overall first-quarter figures were better than expected due to the strength of its telecom units. The company's net loss shrank to 319 million euros ($377.6 million) from 815 million euros a year earlier. Revenue dropped to 6.2 billion euros from 14.6 billion euros, although most of the decline was due to Vivendi's sale of its controlling interest in its utility arm last year.</br></br>Universal Music, the world's largest music company, swung to an operating loss of 28 million euros in the quarter. Vivendi Universal Entertainment, the TV and film venture being auctioned, had an operating profit of 213 million euros, down 23% from last year on a pro forma basis, which assumes the acquisition of USA Networks had occurred at the start of last year.</br></br>At least six potential buyers are expected to submit bids for some or all of Vivendi's U.S. entertainment assets on Monday, the deadline in what is likely to be the first round of a prolonged auction. Companies submitting bids are expected to include Liberty Media Corp., Viacom Inc., General Electric Co.'s NBC, Metro-Goldwyn-Mayer Inc., a group of investors led by oil billionaire Marvin Davis and another group led by Edgar Bronfman Jr.