Viv U fights rumors of ad implosion
Paris-based conglom shares sink almost 3%
Despite the denial, Vivendi shares sank almost 3%, as the stock closed down $1.77 at $59.97. Most media shares were down on the day, despite a relatively upbeat stock market session in which the blue-chip Dow Jones Industrial Average closed up 21.74 at 10,645.38.
Investors are concerned that plummeting advertising revenue will drag down the bottom lines of media companies. But Vivendi is less dependent on ad revenue than other congloms, and a spokesman said no profit warnings are planned.
"Vivendi Universal has been informed of the rumors circulating in the market about a possible results profit warning by the group," the Paris-based spokesman said. "Vivendi Universal denies any such prospect."
Meanwhile, another media stock was hit even harder on Wall Street on Monday, as Viacom's most widely tracked Class "B" shares dropped $2.24, or 4%, to $51.31. Concern over the New York-based conglom's advertising exposure likely was exacerbated by reports of preliminary talks to acquire Hispanic broadcaster Telemundo (Daily Variety, June 18).
(Reuters contributed to this report.)
