Float looms for Vivendi film arm

A STOCK market float is looking increasingly likely for Vivendi Universal's US entertainment arm, with the number of potential bidders for the business rapidly dwindling.

Metro-Goldwyn-Mayer pulled out of the auction last week, saying the price was too high. Now it appears that another leading contender, John Malone's Liberty Media group, is also losing interest.

If Malone were to pull out, there would be only one formal offer on the table, that of an investor group led by Edgar Bronfman, the former owner of the assets. Even he may not be a starter as it is believed the group cannot come up with the money Vivendi is demanding.

Most of the original bids came in at about $11bn (£6.8bn) or $12bn. However, Vivendi has told bidders that it wants $14bn for the entertainment assets, and another $1bn on top of that for preferred stock owned by Barry Diller, whom the bidders would have to buy out.

Sources close to the bidding say that Malone's concerns also centre on price.

Liberty has a lawsuit outstanding against Vivendi accusing it of misrepresenting its finances when it bought USA Networks from Liberty two years ago.

Jean Rene Fourtou, Vivendi's chief, has said a public offering was possible if the auction proved unsatisfactory. The most serious potential bidder left in the race is NBC, and it is thought a partnership deal may be reached.