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VU SHARES PLUMMET

Stock Price Down 34% Amid Possible Accounting Problems, Messier Resignation
Just one day after the resignation of CEO Jean-Marie Messier, Vivendi Universal shares plummeted 34% Tuesday after ratings agency Moody's downgraded its long-term debt to junk status and following a report of possible accounting problems, according to the Wall Street Journal.
Vivendi shares nose-dived as investors dumped the stock after the ratings agency downgraded the French media company's long-term debt and said it was considering further downgrades, citing concerns over Vivendi's ability to service its debt, its recent acquisitions and its failure to complete sales of certain assets.

The Journal reports Vivendi shares were temporarily suspended four times on the Paris bourse as the stock hit limit-down thresholds. In early afternoon, the stock was halted until further notice at 15.70, down 34.3%. Meanwhile, French newspaper Le Monde reported Vivendi tried to add 1.5 billion in net profit to its 2001 accounts, related to the sale of Vivendi's stake in United Kingdom pay-television company BSkyB.

The report said the issue was raised after Vivendi parked some 400 million BSkyB shares, or 96% of its total stake in the company, with a financial institution, to comply with the requirements of the European Commission regarding the Vivendi, Canal Plus and Seagram merger.

Meanwhile, Jean-Rene Fourtou, Vice-Chairman of the supervisory board of French-German pharmaceutical giant Aventis and Societe Generale’s honorary Chairman Marc Vienot have been cited as potential replacements of Messier, who Monday resigned as CEO of Vivendi.

Messier expressed fears in an interview published Tuesday that the media and entertainment giant he built would now be dismantled. "I hear, I see the predators prowling, the advisers putting together break-up plans," Messier told the French daily Le Figaro. "My most earnest hope is that the board of directors, as well as the various authorities concerned, don't wreck this achievement."

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