Vivendi likely to spin off Universal By Corie Brown and Richard Verrier | Sentinel Staff Writer Posted July 25, 2002 LOS ANGELES -- Vivendi Universal's Hollywood executives returned from their first face-to-face meetings with the new chairman in Paris with one clear impression: The French want to be out of the American entertainment business as badly as the Americans want them to leave. Vivendi Chairman Jean-Rene Fourtou did not specifically say he planned to sell the American companies, sources close to the discussions said. However, he left little doubt that Vivendi does not plan to be a long-term parent company to Universal Studios or Universal Music. Exactly how and when Vivendi plans to spin off the studio and music company, and whether they would be a single company or two entities, is a subject of speculation on the Universal City studio lot. Sources close to the discussions in Paris said that the French executives did not discuss any specifics with the American executives. Stressing that the meetings were collegial and cooperative, the sources said Vivendi board members are still sorting through their options and have not yet declared a new strategy for the company. Vivendi stock has fallen 70 percent this year amid investors' concern over the company's enormous debt load and incoherent strategy. Fourtou was brought in earlier this month to replace former chairman Jean-Marie Messier, whose vision of transforming the French water and sewer company into a global media giant was rapidly sinking the company. The meetings Monday were designed to bring Fourtou up to date on Vivendi's Hollywood operations. The American executives were also part of a series of presentations to Vivendi's bankers. On Wednesday, Fourtou said Vivendi plans further major asset sales beyond the announced disposal of certain money-losing divisions of French pay-television company Canal Plus. He did not declare what he plans to put on the auction block. The likely candidates include Houghton-Mifflin publishing company and Vivendi's 44 percent stake in French telecom operator Cegetel, sources close to the board say. Fourtou also said he expects next month to secure another bank loan, estimated at $2 billion to $3 billion to ease the company's cash crunch "Vivendi Universal is carrying too much debt," Fourtou said. "Lowering the debt burden will require significant asset disposals. However, we do not intend to rush into any actions." Even so, there is a frenzy of speculation surrounding who will buy Universal Studios. Off-the-cuff remarks by NBC chief executive Robert Wright that his company might be interested in buying or merging with the studio created a furor at a meeting of television journalists in Pasadena, Calif., on Wednesday. Network sources later said Wright's comments were exaggerated. Separately Wednesday, Vivendi Universal Entertainment Chairman Barry Diller, a key executive at the Paris meetings, expressed his support for Fourtou. He is "straight, direct [and] has one goal in mind, which is to stabilize the company financially," Diller said. Vivendi's share price rallied after the announcement, closing at $16.15, up 85 cents on the New York Stock Exchange. All I can say is I HOPE Eisner DOES'T get n e ideia's if i were him i'd just stick with the Muppet sale!!!