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News > International
Bronfman warns on Vivendi-NBC tie
French firm's co-founder calls merger with GE unit 'exactly the wrong outcome' for shareholders.
August 28, 2003: 1:52 PM EDT

NEW YORK (CNN/Money) - As the bidding for Vivendi Universal's U.S. entertainment assets intensifies, the company's co-founder, Edgar Bronfman Jr., is fighting to save what he sees as the unit's value.

The Financial Times reported Thursday that Bronfman has warned that a merger with NBC, a unit of General Electric (GE: down $0.31 to $29.44, Research, Estimates), would be "exactly the wrong outcome" for shareholders. Bronfman is a part of a group of investors bidding for the U.S. assets.

"The share price hasn't moved for a reason; no one knows what they're doing," Bronfman told reporters.

"NBC [has] never run a studio, an entertainment cable network or a theme park," he added. "It would be a huge leap of faith towards a goal which is the wrong one to begin with, namely more entertainment rather than less."

The paper said people close to the company were surprised by Bronfman's statement in light of NBC's success resuscitating Bravo, the cable network it bought last year.

Vivendi is asking $14 billion for its Universal Entertainment unit, but none of the current bidders has met its asking price. NBC proposed a strategic alliance between the two companies that would allow Vivendi to sell its 20 percent stake in the new venture further down the line, while the Bronfman group recently raised its bid from $12 billion to just over $13 million in order to edge out the network.  Top of page

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