Seagram Co Ltd

Vivendi's agreement to acquire Seagram Co. and part of Canal Plus was approved by a French regulator after concessions by Vivendi. But analysts suggested the changes could jeopardize the terms of the $46-billion accord. The French media and utility company agreed to modify the acquisition, giving control of Canal Plus' French pay-TV subscriber base back to Canal Plus Programmes, a unit that will be 49% owned by Vivendi, the regulator said.

Jean-Marie Messier is not afraid of Napster. The 43-year-old Frenchman who runs Vivendi is betting the bank that Seagram Co.'s giant record division can stamp out digital piracy simply by offering better service and higher quality audio files to music fans on the Internet.

Next month, after two years of planning, the world's biggest record company will unveil its answer to Internet piracy. Seagram's Universal Music Group will start selling digital downloads on the Web, hoping against reason that fans will cough up $2 each for songs they still can easily download elsewhere for free. It's a Hail Mary shot that few executives believe will work.

French utility and telecommunications giant Vivendi, which plans to buy Seagram Co. and its Universal Studios subsidiary for $34 billion in stock, scaled back further and rescheduled again an initial public offering in France of its environmental business, citing softer-than-expected demand and poor stock market conditions there. The development isn't expected to threaten the Seagram deal, sources said.

To hear Vivendi Chairman Jean-Marie Messier talk, the days are numbered for the old guard of xenophobic French cultural gendarmes. Bashing Hollywood and pushing to restrict the U.S. film industry's influence there are passe. "Don't tell us about all the French archaic world," Messier said during an interview in Los Angeles last week. "This is gone.

It's not easy selling a $34-billion deal, as France's Jean-Marie Messier knows from his tiring, whirlwind roadshow this week pitching Vivendi's proposed acquisition of Seagram and its Universal Studios entertainment operation. Vivendi's spirited 43-year-old chairman is weary from a schedule that in four days took him from New York to Boston to Chicago to Denver to Los Angeles, and finally to San Francisco on Thursday before flying back to Paris.

Barry Diller is struggling to be a Francophile, but it's not clear whether the beret fits. The proposed purchase of Seagram Co., the largest owner of his USA Networks Inc., by French media and utility giant Vivendi could free Diller from the overly protective Seagram, which has restricted his growth. Vivendi may allow Diller to make some big purchases and become the A-list media player he has yearned to be.

The glitter of hard cash, not mere show business glamour, is luring Vivendi of France to offer $34 billion for Seagram Corp., the world's largest music company and owner of Universal Studios. Seagram may look anemic in reported profit--its 1999 results show a net loss on $15 billion in revenue. But the loss reflects debt taken on to acquire the music company Polygram. Seagram actually had cash flow of $1.5 billion by the reckoning of professional investors.

Earlier this year, Seagram Chief Executive Edgar Bronfman Jr. sold a home in Malibu, which he had never lived in, for more than $10 million. It was a tidy profit, considering he paid $6.5 million in 1997. Now, five years after acquiring Universal Studios Inc., Bronfman is selling the studio along with the rest of his Seagram empire to France's Vivendi. As with the Malibu home, he's making a nice profit on a place where he has been little more than an absentee landlord.

Vivendi, the French media and utility company that's acquiring Seagram Co., called a news conference along with Electricite de France, Europe's largest electricity provider, bolstering talk they will combine their energy units. EDF and Vivendi, which agreed to buy Seagram and Canal Plus for about $34 billion this week, will unveil plans to merge their energy businesses to create one of Europe's largest energy service companies, said Michel Clerc, a spokesman for French trade union CGT.