Vivendi Rejects Break-up Plan As Profits Rise

Officials from French-headquartered media giant Vivendi Universal, which includes music and mobile phone divisions alongside game division Vivendi Games, have released details of the company’s first quarter profits, following a revenue report last month. The company reported a 41 percent gain in first quarter net income to €707 million ($912m) or 61 cents a share. This was more than analysts expected, and the company raised its outlook for 2006 profit growth as a result. “Each of the group's business units is expected to enjoy robust growth in operations and profits,'' a spokesperson said. “Average growth in the group's earnings from operations should range between 8 percent and 10 percent per year.'' Once again, Blizzard’s World of WarCraft was singled out as one of the major contributing factors to the results, alongside improved profits from music downloads and wireless units SFR. The newly renamed Vivendi Games division reported quarterly earning of €23 million ($30m), up 109.1 percent compared to the previous year, with higher margins on the now well-established World of WarCraft being cited as the main reason for the large increase. At the same time, the company rejected a plan from Norwegian investor Alexander Vik to break up the company. According to a Bloomberg report Vik’s proposal offered about 33.50 euros a share, valuing Vivendi at 38.6 billion euros ($49.8 billion).