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Vivendi Case Study

Case | HBS Case Collection | November 2004 (Revised July 2005)

Messier's Reign at Vivendi Universal

by Rakesh Khurana, Vincent Dessain and Daniela Beyersdorfer

Abstract

Focuses on a crisis in the board at Vivendi. Highlights the difficulties that arise when dramatic pressure from outside the boardroom affects boardroom dynamics. In this case, there are two events. The first is an unexpectedly large financial loss and a pending cash flow crisis that forces Vivendi's directors to deal with the issue of dismissing their CEO. Whatever they decide, their actions will be scrutinized by the press and investors and will likely be revisited in a legal environment. The second is the board diagnosing its role in the financial crisis by approving a series of costly acquisitions in recent years that led to the crisis.

Keywords: Corporate Governance; Crisis Management; History; Cash Flow; Acquisition; Performance; Telecommunications Industry; Media and Broadcasting Industry;


Case Details:

Price:

Case Code:BSTR054Electronic Format: Rs. 500;
Courier (within India):Rs. 25 Extra

Themes

Corporate Restructuring
Case Length:17 Pages
Period:1996 - 2003
Organization:Vivendi Universal
Pub Date:2003
Teaching Note:Not Available
Countries :France
Industry:Media & Entertainment

Abstract:

The case examines the problems faced by the French media giant Vivendi Universal (VU), which led the company to post the country's biggest ever corporate loss of $ 25.6 billion in 2003. The case attempts to analyze how and why Jean Marie Messier's (VU's Chairman) ambitious plans to turn the water and waste management company into one of the world's largest media groups failed. Problems such as the lack of a proper strategic plan and the mismanagement of company funds have been studied in depth. The case also discusses the measures taken by Messier's successor Fourtou to save the company from becoming bankrupt and to restore investor confidence.


Issues:

» Understand the rationale behind a company decision to grow through mergers and acquisitions instead of growing internally

» Appreciate the critical role careful and sound financial management as an important parameter in the acquisition process

Contents:

Keywords:

French media, Vivendi Universal, VU, corporate loss,$ 25.6 billion, 2003,Jean Marie Messier, VU, Chairman, water, waste management, strategic plan, mismanagement, Messier, Fourtou, bankrupt, investor confidence

Vivendi Universal: In a Strategic Flux- Next Page>>


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