Filed by Vivendi
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
under the Securities Exchange Act of 1934
Subject Company: The Seagram Company Ltd.
Commission File No. 1-2275
and
Subject Company: Canal Plus S.A.
Commission File No. 82-2270
October 12, 2000
PRESS RELEASE
OCTOBER 12, 2000
VIVENDI UNIVERSAL
===========
INVESTOR CONFERENCE
FINANCIALS AND SYNERGIES
PARIS, FRANCE, OCTOBER 12, 2000 - Today, Vivendi, Seagram and Canal+ are holding
an Investor Conference in Paris to present the strategic rationale behind the
creation of Vivendi Universal, as the company is to be called after that pending
combination of the three companies. The conference is being chaired by Vivendi
chairman and chief executive officer Jean-Marie Messier, joined by Seagram
President and chief executive officer Edgar Bronfman, Jr., and Canal+ chief
executive officer, Pierre Lescure.
"Vivendi Universal will be a global Company for the Digital Age," said Vivendi
chairman and chief executive officer Jean-Marie Messier. He continued: "Vivendi
Universal will be a consumer-focused, performance driven, values-based global
media and communication company. Our vision is to be the world's preferred
creator and provider of personalised information, entertainment and services to
consumers anywhere, at any time, and across all distribution platforms and
devices."
"We felt we owed our shareholders and the financial analysts an in-depth
presentation of the key components and growth potential of the new company,"
added Edgar Bronfman, Jr., who will be Vice-Chairman of the new group.
The conference, which continues tomorrow in Paris, is an opportunity for more
than 30 senior managers of the combined entity to present their business units
and the synergies expected from the three-way combination.
"IDEALLY POSITIONED FOR THE DIGITAL CONVERGENCE" - Jean-Marie Messier, Edgar
Bronfman, Jr. and Pierre Lescure have all expressed their confidence in Vivendi
Universal: "the company will have the perfect mix of assets, combining rich
global and local content (Music, Publishing and Films) with state-of-the-art
interactive distribution channels (Mobile telephony, Pay-TV, international
channels, Internet portals...) to seize growth opportunities in all its
markets," declared Jean-Marie Messier. "The combination of experienced
international management skills and solid balance sheet with strong cash-flow
generation will allow us to thrive in the new Global Media industry," added
Edgar Bronfman, Jr.
JEAN-MARIE MESSIER, EDGAR BRONFMAN JR. AND PIERRE LESCURE OUTLINED THE
POTENTIAL IMPACT OF SYNERGIES, DIVISIONAL GROWTH FORECASTS, AND ANNOUNCED
ADDITIONAL SENIOR MANAGEMENT APPOINTMENTS.
SYNERGIES - Vivendi Universal continues to express its confidence in the
prospects for the combined company. As working groups involving representatives
of all business units have assessed hundreds of operational opportunities, a
list of numerous synergies has been validated and the divisional management
teams have fixed the following targets:
<PAGE>
o Cost synergies are expected to contribute a positive incremental
420 million euros to the consolidated pro-forma EBITDA for 2002. The
main areas identified to achieve these cost reductions encompass
functional overheads, logistics, purchasing policy and IT expenses;
o Revenue synergies have been estimated at 200 million euros in 2002 and
above 400m euros in 2003, through a series of cross-divisional
initiatives to include:
o cross-content combinations: group-owned contents will be
systematically available across the range of group-owned
distribution assets, e.g. film characters for games, game
themes for theme parks...
o Music/Cegetel Mobile services: beyond improvement of current
audiotel services, new functionalities and new services
will be created such as: music communities, mailbox
personalization, ring tone services...
o Vizzavi/Universal Music opportunities: Vizzavi can widen the
opportunities to listen to Universal music - and Universal
music and film can enhance Vizzavi's features to drive
adoption; Music CDs will be used to ramp up registration and
traffic and in the future they will offer the opportunity to
access Vizzavi customized portals with artist features...
o loyalty programmes: the loyalty tokens called Flips as
created by Flipside.com, the online-game subsidiary of Havas
Interactive, will be extended to a number of services and
products of Vivendi Universal...
o Canal+/Universal Studios projects: the close nature of
the businesses, film production, distribution, thematic
channels, open virtually unlimited cooperation prospects...
FINANCIALS - Jean-Marie Messier has announced that Vivendi Universal's
consolidated pro-forma revenues in the communications group are expected to
amount to 24.6 billion euros in calendar year 2000. Consolidated pro-forma
revenue growth over the 2000-02 period is expected to reach 10% p.a. as:
o Content divisions (Music, Publishing, Filmed entertainment) are
expected to grow at between 6% and 7% p.a. overall;
o Access divisions (Canal+, Telecoms) overall at between 15% and
20% p.a., reflecting growing penetration rates in all their markets;
o And Internet activities are estimated to grow dramatically over the
period to reach significant weight by 2002 (VivendiNet, Vizzavi, and
USAi's internet businesses).
The pro-forma revenue contribution for 2000 of each division is expected to be
as follows on a consolidated basis:
Music 6.6 billion euros
Publishing 3.5 billion euros
Filmed entertainment* 4.6 billion euros
Canal+ 4.0 billion euros
Telecoms 5.8 billion euros
TOTAL 24.6 BILLION EUROS
Significant non-consolidated activities are expected to amount as follows
(figures for 100%):
Vizzavi (50%) n.a.
Recreation affiliates** 1.2 billion euros
USAi (43%) 4.6 billion euros (market consensus)
Xfera (31.5%) n.a.
BSkyB 3.4 billion euros (market consensus)
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* Including consolidated Recreation operations (Theme parks)
** 50% of Universal Orlando, 24% of Universal Studios Japan, 37% of Port
Aventura, Orlando resorts
<PAGE>
Vivendi Universal is targeting a consolidated pro-forma EBITDA for 2000
of approx. 3.5 billion euros in 2000 for the communications business. The
breakdown is as follows:
Music 1.1 billion euros
Publishing 0.5 billion euros
Filmed entertainment 0.3 billion euros
Canal+ 0.4 billion euros
Telecoms 1.3 billion euros
Internet (0.1) billion euros
TOTAL 3.5 billion euros*** 3.2 BN EUROS AFTER
INCLUDING
HOLDING CONTRIBUTION.
Significant non-consolidated activities are expected to amount as
follows (figures for 100%):
Recreation affiliates 0.2 billion euros
USAi (43%) 0.8 billion euros
BSkyB 0.4 billion euros
The group expects the consolidated pro-forma EBITDA to grow at more than 35%
p.a. on average over the 2000-2002 period, with the following divisional
contributions:
o Content businesses are expected to enjoy solid stable growth at
overall 12% p.a..
o Access divisions are expected to leverage revenue growth
dynamics in a fixed cost environment, and are expected with overall growth
of more than 35% p.a.(taking into account current expectation of Cegetel
and Canal+ growths).
o Aggregation (Internet) and synergies to progressively and significantly
enhance organic growth of content and access divisions.
o Synergy impact.
Vivendi Universal expects that Free Cash Flow generation will be strong
especially from the Content businesses: consolidated Free Cash Flow (excluding
UMTS and disposals, including financing costs and dividends) is expected to
reach 0.8 billion euros in 2001 and 2.1 billion euros in 2002 (before
restructuring costs estimated at 0.6 billion euros, 0.4 billion euros after tax,
in 2001 only).
The Free Cash Flow will finance internal growth of access and aggregation
divisions: UMTS networks in France and Spain, as well as the development of
Vizzavi (in which Vivendi's share of anticipated funding is estimated at between
0.6 billion euros and 0.8 billion euros). The group will also expects to derive
significant proceeds from disposals, estimated at over 4 billion euros for the
period.
Limited debt exposure - Vivendi Universal `s debt in communication will be very
limited, Vivendi Communication being in debt for a net pro-forma of 1.2 bn
euros, and the proceeds of Seagram's Spirits and Wine business being expected to
offset Seagram's net debt.
The shareholder equity of the group will amount to an estimated 57 bn euros
(French GAAP, mORE in US GAAP) after the closing of the three-way combination.
MANAGEMENT RESPONSABILITIES - Jean-Marie Messier will be Chairman and chief
executive officer, Edgar Bronfman, Jr., Vice-Chairman, and Eric Licoys and
Pierre Lescure will be co-Chief Operating Officers.
Eric Licoys, as co-COO, has been made responsible for the delivery and
implementation of all synergies of the group. Agnes Touraine will consequently
become Chief Executive Officer of Havas, while Eric Licoys will remain
non-executive Chairman.
A number of additional functional appointments have already been made and the
group has also announced that it is to appoint a Customer Relationship Manager
and a Chief Information Officer.
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*** 3.2 billion euros after corporate expenses of -0.3 billion euros
<PAGE>
These two positions are expected to be filled by executives with international
experience therefore contributing to the internationalization of the management
team.
These decisions will allow the group to better seize forthcoming opportunities
across the range of its businesses on a global basis.
The new management team of Vivendi Universal will repeat its presentation in New
York City on Tuesday October 17th to North American investors and analysts.
IMPORTANT LEGAL DISCLAIMER
THIS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF THE "SAFE
HARBOR" PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.
THESE STATEMENTS ARE BASED ON MANAGEMENT'S CURRENT EXPECTATIONS OR BELIEFS AND
ARE SUBJECT TO A NUMBER OF FACTORS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL
RESULTS TO DIFFER MATERIALLY FROM THOSE DESCRIBED IN THE FORWARD-LOOKING
STATEMENTS. THE FORWARD-LOOKING STATEMENTS CONTAINED IN THIS RELEASE ADDRESS THE
BUSINESS COMBINATION OF VIVENDI, CANAL+ AND SEAGRAM. THE FOLLOWING FACTORS,
AMONG OTHERS, COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE
DESCRIBED IN THE FORWARD-LOOKING STATEMENTS: THE RISK THAT THE VIVENDI, CANAL+
AND SEAGRAM BUSINESSES WILL NOT BE INTEGRATED SUCCESSFULLY; COSTS RELATED TO THE
COMBINATION; FAILURE OF THE VIVENDI, CANAL+ OR SEAGRAM'S SHAREHOLDERS TO APPROVE
THE COMBINATION; THE RISK THAT SEAGRAM WILL BE UNABLE TO EFFECT THE DISPOSITION
OF ITS SPIRITS AND WINE BUSINESS OR EFFECT SUCH DISPOSITION ON SATISFACTORY
TERMS AND CONDITIONS; INABILITY TO FURTHER IDENTIFY, DEVELOP AND ACHIEVE SUCCESS
FOR NEW PRODUCTS, SERVICES AND TECHNOLOGIES; INCREASE COMPETITION AND ITS EFFECT
ON PRICING, SPENDING, THIRD-PARTY RELATIONSHIPS AND REVENUES; INABILITY TO
ESTABLISH AND MAINTAIN RELATIONSHIPS WITH COMMERCE, ADVERTISING, MARKETING,
TECHNOLOGY, AND CONTENT PROVIDERS. NONE OF VIVENDI, CANAL+ OR SEAGRAM UNDERTAKES
ANY OBLIGATION TO PROVIDE UPDATES OR TO REVISE ANY FORWARD-LOOKING STATEMENTS.
INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE JOINT PROXY
STATEMENT/PROSPECTUS REGARDING THE BUSINESS COMBINATION TRANSACTION REFERENCED
IN THE FOREGOING INFORMATION, WHEN IT BECOMES AVAILABLE, BECAUSE IT WILL CONTAIN
IMPORTANT INFORMATION. THE JOINT PROXY STATEMENT/PROSPECTUS WILL BE FILED WITH
THE U.S. SECURITIES AND EXCHANGE COMMISSION BY VIVENDI, CANAL+ AND SEAGRAM.
INVESTORS AND SECURITY HOLDERS MAY OBTAIN A FREE COPY OF THE JOINT PROXY
STATEMENT/PROSPECTUS (WHEN IT IS AVAILABLE) AND OTHER DOCUMENTS FILED BY
VIVENDI, CANAL+ AND SEAGRAM WITH THE COMMISSION AT THE COMMISSION'S WEB SITE AT
WWW.SEC.GOV. THE JOINT PROXY STATEMENT/PROSPECTUS AND THESE OTHER DOCUMENTS MAY
ALSO BE OBTAINED FOR FREE FROM VIVENDI, CANAL+ AND SEAGRAM. INFORMATION
REGARDING THE PARTICIPANTS IN THE PROXY SOLICITATION AND A DESCRIPTION OF THEIR
DIRECT AND INDIRECT INTERESTS, BY SECURITY HOLDINGS OR OTHERWISE, IS CONTAINED
IN THE JOINT PRESS RELEASE RELATING TO THE TRANSACTION FILED WITH THE COMMISSION
BY EACH OF VIVENDI AND SEAGRAM, ON JUNE 20, 2000.
