Universal Music Earnings Dip In First Nine Months

Universal Music Earnings Dip In First Nine Months

Vivendi chairman Jean-René Fourtou has taken leadership of Universal Music's proposed $1.9 billion acquisition of EMI's recorded-music division, hoping to persuade regulators not to block or overly diminish the deal, according to a report published late Friday in the Financial Times.

The move marks a dramatic change in Vivendi's approach in the wake of former CEO Jean-Bernard Levy's departure last month, observers told the paper, with the implication being that the EMI deal played a more significant role in Levy's exit than was said at the time.

Fourtou is emphasizing UMG's willingness to make concessions to limit concerns, many of which were aired in a Congressional hearing late last month, about the company dominating the market and stifling innovation in the digital sphere, the sources said, adding that it now appears less likely that Vivendi will sell or spin off Universal as they examine restructuring possibilities due to a weak share price.

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"The European Commission won't want to humiliate Vivendi at a time when it's weak," one person close to the situation reportedly said.

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The commission has presented a series of objections to the deal, which Universal answered in a confidential response last week.

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The report also says that Fourtou and former Warner Music chairman Edgar Bronfman Jr -- a longtime and vocal opponent of the deal -- "discussed Universal in Paris" over a month ago, citing people briefed on the meeting, adding that they denied Bronfman had made any proposal to buy Universal. However, Warner would be among the most likely entities to bid for any assets Universal sells to close the EMI deal.

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Billboard.biz will have more on this story as it develops.