Debt-laden media giant Vivendi Universal is reviewing its business strategy and embarking upon a E10 billion asset disposal programme in an effort to pay off a E19 million debt pile, and to refinance E5.6 billion of borrowings by March 2003.

The debt is the result of ex CEO Jean-Marie Messier’s acquisition spending spree which saw Vivendi Universal complete some 184 acquisitions in three years with a total cost of around $80 billion, according to data from Thomson Financial.

When the current CEO Jean Rene Fourtou joined Vivendi in July, replacing Messier, he found the group facing major liquidity issues and the challenge Fourtou is now up against is not which businesses to sell, but rather which are worth keeping.

In a statement, Fourtou said: “Vivendi Universal has around E10 billion of debt above the comfortable level allowed by a triple-B rating.” He said Vivendi must endeavour to decrease this debt by at least this amount as soon as possible. This, he says will be done by selling the group’s non-core assets Vivendi has committed to selling assets for a minimum amount of E10 billion in the two years to come, E5 billion of which will be completed in the next nine months. The group has already negotiated with seven banks to obtain a E1 billion cash facility, which was provided by BNP Paribas, Citibank/SSSB, Credit Agricole Indosuez, Credit Suisse First Boston, Deutsche Bank and SG.

Fourtou emphasised cutting the cash drain of the company, mainly the non-French activities of the Canal+ Group, the Internet activities and the huge level of corporate overhead. Planned asset sales include US publisher Houghton Mifflin, the non-French assets of Canal+ and portal Vizzavi, which is in discussions with Vodafone Group. Core assets Fourtou has stressed he will not sell include the group’s 44 per cent shareholding in French telecoms arm Cegetel, Vivendi Environment, the French activities of pay-TV business Canal+ and the publishing assets (other than Houghton Mifflin) of Vivendi Universal Publishing. The group is due to finalise its asset sale plans in time for a September 15 board meeting. Fourtou stated that no comment would be made regarding disposals before their completion.