Vivendi Boss Takes Heat at Shareholder Meeting
French media magnate Jean-Marie Messier headed off talk of a board mutiny Wednesday yet was snubbed by Vivendi shareholders who refused to hand him new stock options after seeing their own shares decline, report Merissa Marr and Nathalie Meistermann of Reuters.
Shareholders in the global media group, which owns Universal Studios, threw out the controversial stock option plan after a rowdy four-hour meeting in which France's top corporate star was repeatedly booed following steep losses and a plunge in shares.
Messier had pressed for the right to issue new stock options to senior managers, including himself, saying it would otherwise be impossible to attract and keep talent at the world's second largest media firm after AOL Time Warner.
He had promised not to exercise any of his own options unless Vivendi shares recovered sharply. But small shareholders argued the plan would let Vivendi bosses cash in on weak prices.
A year after Messier basked in Vivendi's transformation from a water and sewage firm (primarily USFilter in the U.S.) into a media empire with a guaranteed seat at the Oscars, the unusually rowdy shareholders' meeting showed the French chief executive battling on several fronts.
Perched on a concert stage on the outskirts of Paris, the man Fortune magazine once proclaimed a corporate rock star was harangued by shareholders who have seen their investments fall by 70 percent in two years as Vivendi expanded into Hollywood.
"Messier resign!" shouted one shareholder as the dapper former banker effectively pleaded for time to see through his vision of making Vivendi a global media and telecoms player.
Others cried "Pack your suitcase!" and called him Pinocchio.
Investors have soured on Messier's glitzy management style after Vivendi last month posted France's worst corporate annual loss. Not only were shareholders up in arms about share bonuses, but staff accused him of bleeding the company and politicians and film makers accused him of selling out French culture.
Messier triggered a storm last week when he sacked the boss of satirical TV channel Canal Plus. His global ambitions even earned him a bit part in France's dramatic presidential elections -- branded a puppet-master of conservative President Jacques Chirac by far-right challenger Jean-Marie Le Pen.
In an apparent bid to stop Vivendi being dragged further into France's political crisis, Messier postponed plans to sell majority control of Vivendi's utility assets. The move had raised fears foreigners could gain control of the water supply.
Watched by French riot police, around 200 Canal Plus workers and anti-globalization activists staged peaceful protests outside the stadium as Messier slipped in through a back door.
France's broadcast watchdog has also piled on the pressure, demanding further assurances on the independence of Canal Plus, after Messier's controversial sacking of CEO Pierre Lescure last week.
Messier, however, seized on the company's better-than-expected first quarter results as a sign that Vivendi was in good operational health.
Vivendi said core profit, or EBITDA, in communications and media rose 16 percent in the first three months of the year to 1.17 billion euros as revenues were up 12 percent to 7.11 billion -- both just above expectations.
Messier told shareholders its first quarter performance had put Vivendi ahead of all its targets and were proof its strategy was working. Often labeled a chronic dealmaker, he reiterated the media group planned no further major acquisitions in 2002.
"After everything that was said in the media, I am more than happy with the board and shareholder meetings," Messier said.
Messier's $50 billion gamble to turn Vivendi from a water utility into a media giant last year turned sour amid huge losses, burgeoning debts and tumbling shares. But Messier told his 5,000-strong audience Vivendi had been misunderstood.
"We have shown strong internal growth and higher margins but our results have not always been judged fairly because there is no comparison with the past," Messier said.
"We are in part responsible for this situation and must do more to explain our strategy, which is to be the world's number one global media group."
Messier even called on Vivendi board member and French banking veteran Marc Vienot, who told shareholders the board backed both Messier and his strategy.
Vivendi also dismissed speculation that Messier's twin roles as chairman and chief executive may be split into two.