The Rise and Fall of Vivendi Universal's Jean Marie Messier

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Case Details:

Case Code : LDEN015
Case Length : 11 Pages
Period : 1996-2002
Pub Date : 2003
Teaching Note :Not Available
Organization : Vivendi Universal
Industry : Media and Entertainment Countries : France

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Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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The Dealmaker

At the time of his joining CGE, analysts regarded Messier as a young, dynamic and forward-looking leader, who could pull the company out of its problems...

The Other Side of the Coin

Not everyone approved of Messier's approach towards business. A Paris stock market analyst commented, "Messier may have unloaded a lot of excess business, but he's still got a ways to go. The strategy with the water business is to reinvest part of the expected profit into the communications side. At some point, however, you have to wonder if it's a good idea to be world leader, on one hand, and the key European player, on the other, in two very different sectors that have nothing to do with one another at the end of the day"11. One of the biggest areas of concern about VU was its debt portfolio. Messier had taken $17 billion in debt to finance some high profile deals since the time he had begun his takeover/acquisition spree...

The Downfall

Industry observers were of the opinion that the rapid pace at which Messier was making acquisitions and the questionable strategic logic behind some of them could land VU in serious trouble...

Messier Steps Down

Messer was also accused of concealing the severity of the liquidity problems that the company was facing.

He had reportedly issued several press statements saying that VU did not face any 'immediate and severe cash shortage.' This was however, not true, given the company's precarious debt position and severe cash flow problems.

VU's share value had also dropped by 70% since the beginning of the year. Even the company's board began to lose confidence in him...


Exhibit I: VU - Consolidated Statement of Income
Exhibit II: Vivendi - Key Financials (1996-2000)
Exhibit III: Major Acquisitions made by Messier

11]  As mentioned in the article titled 'Jean Marie Messier' dated September 19, 1999 at


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