Man Without Qualities

Wednesday, July 03, 2002

Never Give a Sucker an Even Break! V

The Vivendi board did indeed appoint Jean-René Fourtou as interim chairman and chief executive today, replacing Jean-Marie Messier, who resigned. Mr. Fourtou is not reported to have any experience guiding companies in crisis, nor is he said to know even a dollop about entertainment companies. But he is French – which is what the board is said to really care about. Vivendi may sense a certain vacuum in his background, since somebody seems to have induced Reuters to call Mr. Fourtou a "restructuring expert" - although his restructuring experience appears confined to reshaping what had been a big sluggish, state-owned drug company, Rhone-Poulenc. He led Rhone-Poulenc through privatisation into a merger with Hoechst to create Aventis. But neither Rhone-Poulenc nor Aventis ever faced a liquidity crisis or the collapse of its basic business plan.

Perhaps just to show what nice guys they are, the Vivendi board is also irrelevantly accreting to itself Claude Bébéar, the chairman of the French insurance giant Axa, and Gerard Kleisterlee, the chief executive of Royal Philips Electronics, the Dutch consumer electronics company that owns a 3.25 percent stake in Vivendi.

Reports are that Mr. Fourtou, the vice chairman of the supervisory committee at Aventis, the French-based pharmaceutical company, has been friends for three decades with Mr. Bébéar! So at least Mr. Fourtou won't be lonely - which would just be terrible, since he's already going to be running a business he knows nothing about and which has descended into near-chaos.

Investors appeared to signal their confidence in the Vivendi board actions by removing about another 22% of the Vivendi stock price today.

The Bronfman family stake in Vivendi is valued at about $1 Billion (down from $3 Billion this year). So today alone the family lost something like $220 Million dollars. Who's counting?

Hey, pretty soon they'll be talking real money!

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