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EDITIONS
Thursday, 21 November, 2002, 20:18 GMT
Vivendi deal seen next year
Vivendi Universal Chairman Jean-Rene Fourtou
Mr Fourtou seeks to sell Vivendi assets to relieve debt
Talks between Vivendi Universal and an investor group led by oil-billionaire Marvin Davis are expected to resume in January despite reports the two entities reached an impasse, a source has told the BBC's World Business Report.


With the company valued so cheaply, predators are bidding for their assets

Romain Boscher,
fund manager
Following deliberations, the French media group could be in the hands of Mr Davis within three to four months, said a source close to Mr Davis.

The group has been keen to buy Vivendi Universal assets, including Universal Studios, Universal Music and the group's networks and theme parks.

The investors have agreed to pay $15bn (9.5bn), with Mr Davis' group taking on an additional $5bn in debt.

The money would come from entertainment insiders who know the industry, the source said.

The January talks could move very quickly, the source added.

Asset sale

News reports on Thursday said Vivendi had turned down the group's offer.

But the source close to Mr Davis said talks have idled while Vivendi focuses on its offer to acquire the 26% stake in mobile-phone group Cegetel currently owned by BT Group.

Vivendi has until 10 December to raise 4bn euros for BT's stake, to counter an existing bid from Vodafone.

Vivendi Chairman Jean-Rene Fourtou is keen to sell non-core Vivendi assets to tackle the group's massive debt problem.

Recently, Vivendi announced plans to dispose of assets worth 7bn euros (4.5bn; $7bn) by the end of the year - and a further 16bn euros by the end of November 2004.

Reports have also suggested that Vivendi is close to selling half its 40% stake in Vivendi Environnement, the water and sewerage firm.

The sale could generate more than 1.8bn euros (1.1bn).

Hot assets

Currently, the company is also undergoing a range of inquiries.

Its account are being investigated in France and it faces criminal investigations in the US.

Nonetheless, investors appeared cheered by news of the possible sale, with shares leaping over 20%.

"The shares are very cheap, and they are starting to come out of the woods a bit now," said Romain Boscher, a fund manager at Finama Asset Management in Paris.

"With the company valued so cheaply, predators are bidding for their assets."

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