A U.S. court ordered Vivendi Universal on Monday to pay a disputed $23 million in severance to its former chief Jean-Marie Messier as French prosecutors began examining the findings of a stock market probe into possible financial irregularities.
The New York state court order contradicts an earlier French ruling and Vivendi said it would use “all legal options” to oppose the payment to Messier, who was forced out last year after a frenzied acquisition spree brought the French media giant close to collapse.
The decision came as Messier welcomed the findings of a probe by the French stock market regulator, which he said cleared him of accusations that he mislead shareholders about the company’s financial health.
The Paris public prosecutor said it was examining the findings of the 15-month probe by la Commission des Operations de Bourse (COB) into possible irregularities in Vivendi Universal’s financial disclosures.
The COB passed its findings to the prosecutor’s office after determining the media company may have broken the law, a source familiar with the matter said.
The source also said the COB may impose sanctions of its own on Vivendi when it rules, after a comment period ends in mid-December, whether some of the company’s financial disclosures violated regulations.
Messier, in an interview with the financial daily Les Echos, said the report asked a lot of questions but did not offer conclusions and was globally positive for Vivendi since it found no evidence of systematic fraud.
“Overall, I have the following impression: This report should allow us to put the ’VU affair’ into its proper place,” Messier said in an advance copy of the interview to be published on Tuesday.
The COB declined to comment on the matter.
No massive legal fraud
The COB has been investigating allegations that Vivendi gave false and misleading information to shareholders during Messier’s tenure. It has also been probing some of the company’s accounting procedures and accusations that Messier engaged in insider trading.
“They conclude, and I quote ’The service did not find major elements that were hidden ... no massive legal fraud, no transaction leading to the intervention of third parties was found,”’ Messier said in the Les Echos interview.
On allegations of insider trading, he said: “(the report) underlines I continually increased my position in Vivendi all through 2001 while building up a big personal debt.”
“It is therefore obvious that I did not benefit from privileged negative information.”
However, the former chief executive was less upbeat about the COB’s finding that the company’s financial disclosures in 2001 and 2002 were not “exact, precise and sincere.”
“On the contrary, VU (Vivendi Universal) always scrupulously met all its regulatory obligations,” Messier told the newspaper.
Financial statements questioned
Messier’s replacement, Jean Rene Fourtou, has spent the past year unwinding many of his predecessor’s deals to get the company back on its feet. Earlier this month he agreed to a preliminary deal to merge Vivendi’s U.S. film and television assets with General Electric’s NBC unit.
A spokeswoman for the Paris prosecutor’s office confirmed that the COB’s probe had raised questions about Vivendi’s methods of consolidating the results of partly owned subsidiaries and about some of its financial disclosures.
Another area of interest to the regulator was Vivendi’s public statements and the decision to use earnings before interest, taxes, depreciation and amortization as a performance measure, the spokeswoman said, confirming a report in Les Echos.
“This matter is being closely examined,” she said.
Vivendi is also facing investigations by the U.S. Securities and Exchange Commission and the U.S. attorney’s office for the Southern District of New York.