Diller
Fourtou
NEW YORK -- A contingent of Vivendi Universal brass, including chief operating officer Jean-Bernand Levy and chief financial officer Jacques Espinasse, head to Los Angeles today to meet with Viv U entertainment execs.
Chairman-CEO Jean-Rene Fourtou, who met with Barry Diller in New York on Tuesday, will wing it back to Paris.
The jaunt Stateside falls as tensions -- or reports of tensions -- mount between Fourtou and Diller. While some insiders think tales of disaffection are being fanned by Vivendi folk irate at Diller's pivotal role in a sale of U.S. showbiz assets and seeking an upper hand, the VUE chief has been fueling the fire. And the French outdid themselves in creating unnecessary complications for U.
Two weeks ago, Diller is said to have presented Vivendi with a VUE settlement that was immediately shot down by Paris.
Earlier this month, Diller publicly insulted Marvin Davis, a bidder for the Universal assets he's supposed to be helping Vivendi sell. He also said he might be interested in taking on a larger role at U, a possibility that seems bound to create conflict -- or at least the appearance of it -- as he helps Fourtou evaluate other offers.
And Diller continues on as chairman-CEO of USA Interactive. The company, a VUE stockholder, is suing Vivendi for tax payments it says it's owed related to the sale of USA Networks. Vivendi contests the claim. Diller's critics have been circling ever since the suit became public in a USA Interactive filing with the SEC.
The USA Networks deal, orchestrated by ousted Vivendi CEO Jean-Marie Messier, gave U valuable cable channels but also landed Viv U in its current pickle -- where a sale of VUE assets would trigger a big payout to Diller.
Stumbling block
The inability to reach a negotiated settlement for VUE that's satisfactory to both parties is firing up tensions. "It's not personal, like with Diller and Davis. With Diller and Fourtou, it's all business," one insider said.
Last fall, Vivendi created a stopgap entity called Universal Entertainment, which included VUE and Universal Music. Diller and Fourtou were named co-chairs, and it appeared that the French exec was relying heavily on Diller to restructure or sell the entertainment biz. The shadowy company was called "interim" and "loosely constructed."
In December, Vivendi yanked music from Diller's purview. Several Vivendi insiders indicated that U Music topper Doug Morris had never, in fact, reported to Diller. And Universal Entertainment, they said, wasn't a "real" company anyway. Some think Diller himself may have opted to put some distance between himself and the troubled music biz.
Lesson: Don't create half-baked subsids that don't really exist except in their potential for negative gossip and speculation.
Denies pressure
Also Tuesday, Viv U denied reports in the French press that it had pressured France's stock market watchdog agency, the Commission des Operations de Bourse, in its investigation of the company's financial disclosure and other issues. The U.S. SEC and Dept. of Justice have also launched inquiries.
And separately, a U spokeswoman confirmed that Viv U has put on the market a 35-floor office building in which the studio is the main tenant, as well as the Universal City Sheraton and land on which the local Hilton hotel is situated. U reps wouldn't speculate on valuations, but it's believed the office building is worth north of $200 million, while the latter properties could fetch $65 million or so.
U also has put on the block a former Lankershim Boulevard hotel used for studio storage, but the studio hasn't considered selling its lot or the main "Black Tower" office building, the spokeswoman said. The properties being listed for sale have been identified as "non-core assets," she said.
(Carl DiOrio in Los Angeles contributed to this report.)
Contact Jill Goldsmith at
jill.goldsmith@variety.com