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EDITIONS
Tuesday, 26 November, 2002, 21:14 GMT
Vivendi Universal's losses mount
Jean-Rene Fourtou
Jean-Rene Fourtou took over from Jean-Marie Messier
Troubled French media group Vivendi Universal has reassured investors with results only slightly below expectations and a confident view that "Vivendi's cash crisis is now over".

Vivendi, the world's second-largest media company, said it was continuing to lower its large debt mountain by selling assets, and that it expected to have raised 7bn euros (4.4bn;$6.9bn) by the end of the year.

The company also gave the clearest sign yet that it was preparing to buy BT Group's stake in the French telecom firm Cegetel.


(We) will look at any offer for our entertainment assets

Jacques Espinasse, Vivendi CFO

Early speculation of a potential bid from mobile phone giant Vodafone, following a report in US entertainment magazine Variety, was soon dampened after Vodafone denied the suggestion.

Nonetheless, analysts said the market was cheered by the results, as Vivendi shares rose over 3% on its positive outlook.

"Vivendi is going up because there was no catastrophe in the results and because of the article in Variety," said one Paris-based trader.

On track

Vivendi reported a 28.5% increase in its third quarter net loss, but went some way towards reassuring investors with 25% growth in core profits.

Vivendi made a net loss of 1.23bn euros (779.9m; $1.22bn) in the three months to 30 September, compared with a loss of 960m euros at the same time last year.

The debt-laden company has been struggling to reduce its losses this year, and dismissed its controversial chief executive Jean-Marie Messier in July.

Chief financial officer Jacques Espinasse said on Tuesday that the company "will look at any offer for our entertainment assets" as it continues to pay down its debt.

But he confidently stated: "Vivendi's cash crisis is now over."

Phone wars

However, the group has rejected Vodafone's 6.7bn euro (4.2bn;$6.6bn) offer for its 44% stake in the French mobile phone company Cegetel.

Instead, Vivendi said it now has the necessary facilities to up its Cegetel holding by buying BT Group's 26% stake. Vivendi said it would use 2.7bn euros of its own cash and another 1.3bn euros in loan notes if it was to make an offer.

But Mr Espinasse told investors: "This is only a scenario and the board has taken no decision yet."

Vodafone also moved quickly on Tuesday to deny suggestions that it was planning to bid for Vivendi to get its hands on the Cegetel stake.

"Sir Christopher Gent has made it clear that Vodafone has no intention of bidding for Vivendi," a spokesman told the newswire AFX News.

Earlier, the suggestion of a bid had sent Vivendi shares up as much as 8% before but they closed up just over 3% at 15.30 euros.

Vivendi has until 10 December to counter Vodafone's bid for the remaining shareholdings in Cegetel held by BT Group and SBC Communications.

See also:

21 Nov 02 | Business
19 Nov 02 | Business
08 Nov 02 | Business
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