Gallic arrogance that led to downfall

TO THE bitter end, there was a certain magnificent Gallic arrogance about Jean-Marie Messier. With his fate already decided by a board that had finally lost all patience with him, Messier was still trying to set the terms of the appointment of his successor. He was prepared to stand aside for the good of the business, he told Le Figaro newspaper, provided he was replaced by a Frenchman.

Like the last of the doomed Bourbons, he was blind to the coming revolution until the tumbrils were already rolling. To paraphrase Louis XIV, he might just have well have said: 'La compagnie, c'est moi.' In Paris, probably today, the guillotine falls.

Still only 45, Messier's career had been, until little more than a year ago, a story of meteoric ascent. At the peak of the dotcom boom in 2000, he was that rarest of beasts, a French business leader of global stature, feted on Wall Street as well as by the French bourse.

Raised in Grenoble near the Swiss border, the son of an accountant, Messier graduated from France's top business school, Ecole Polytechnique. A career in investment banking followed and, still in his twenties, he was advising the French government on its privatisation programme.

He became the youngest-ever partner at Lazard Freres and by 1994, at the age of 37, he was appointed chief executive of the 150-year-old water giant Compagnie Generale des Eaux. In his eight years at the helm, Messier attempted to pull off what was with hindsight probably an impossible task - the creation of a Franco-American business empire. In practice, his efforts to graft two of the Western world's least compatible cultures left him with only enemies in both camps.

His acquisition of the US entertainment giant Universal, combined with his sacking earlier this year of Canal Plus boss Pierre Lescure, earned him the hatred of the French cultural elite. Stars such as actresses Catherine Deneuve and Juliette Binoche lined up to decry Messier's cultural treachery.

Meanwhile, support from his American investors was also slipping away because he had failed to meet the one and only yardstick for success in Wall Street - making money for the shareholders.

After the acquisition of Universal, through the takeover of its parent company Seagram, Messier was left at the helm of a board split between French and North American factions. Inevitably, his efforts to please both ended in disaster.

In contrast to the flamboyant, high-living Messier, the self-styled J2M, his likely successor Jean-Rene Fourtou, is an experienced industrial technocrat, currently vice-chairman of Aventis, the decidedly European Franco-German pharmaceuticals group. Foutou, 63, is said to be close to Claude Bebear, the honorary chairman of Axa, the insurance group that has been lobbying for top-level changes at Vivendi.

Small, intense and acutely intelligent, Fourtou won widespread admiration for his success in building the State-controlled chemical group Rhone-Poulenc into a global giant and sliding it smoothly into a merger with Hoechst to create Aventis. His skill in consummating overseas deals at affordable prices enabled him to achieve what Messier had failed to do - build a group that was commercially coherent and financially sound.

How the mighty empire is made up

UNIVERSAL Music Group: labels include Polydor, Decca, Philips, Motown and MCA. featuring artists such as the Bee Gees, Elton John, Pavarotti and U2.

Vivendi Universal Publishing: world's biggest dictionaries and encyclopedias publisher. Also publishes educational products, computer games and 16 magazines.

Vivendi Television and Film: Universal studios and theme parks. Behind movies such as A Beautiful Mind and Shrek. Owns European pay-TV group Canal Plus and Italian pay-TV operator Telepiu. Also has cable TV operations in the US.

Vivendi Environnement: controls Vivendi Water, giving it 10% of the UK water and sewage market through Southern Water, Folkestone & Dover Water, Three Valleys Water and waste disposal company Onyx. Also has train operator Connex.

Telecoms: holds 44% of French phone group Cegetel, SFR Mobile Phones and 35% of Morocco's Maroc Telecom.

Vivendi Universal Net: internet music service provider. also holds a stake in the Vizzavi access portal joint venture with Vodafone.

UK interests shielded from trauma

THE huge Vivendi empire built by Jean-Marie Messier has a significant presence in Britain, mainly through Vivendi Environnement, the 'dirty' side of a group, which is 63% owned by Vivendi Universal.

Vivendi Environnement traces its roots to the foundation in 1853 of Compagnie Generale des Eaux, a water distribution company. In recent years, it has made inroads into the UK water and sewage market, of which it controls about 10%, through acquiring Southern Water, Folkestone & Dover Water and Three Valleys Water.

But it is probably best-known in Britain for its notorious transport arm Connex, which won two South of England commuter-train franchises when British Rail was privatised in the mid-1990s. It has since lost the contract for the South Central franchise. It also has a waste disposal company-Onyx, which has won a number of contracts for London local authorities, and an energy operation, Dalkia.

Despite the forces threatening to tear the Vivendi empire apart, the British operations are unlikely to be affected. Vivendi Environnement has a separate quotation and is far less likely to be broken up than its Universal twin, which has very little UK presence.