As it scrambles to sell its giant publishing unit, Vivendi Universal SA is taking one step forward and two steps back.
After receiving low-ball bids for the sale of its entire Vivendi Universal Publishing unit, the troubled media giant has decided to sell the businesses in two parts, sources close to the situation said.
As part of the move, Vivendi plans to sell the non-U.S. assets of its publishing unit, Vivendi Universal Publishing, to French publisher Lagardere SCA for roughly $1.25 billion, sources close to the matter said.
Details of the planned sale of the assets, which include French literature and textbooks, were still being worked out last night. An announcement is expected today.
Vivendi’s French publishing assets include the Larousse and Le Robert dictionaries, educational publishers Nathan and Bordas, and book publishers Plon-Perrin and Robert-Laffont. Other non-U.S. holdings include Spanish and Portuguese-language publishers.
Meanwhile, the troubled media conglomerate is also preparing to hold a new auction for its U.S. publishing unit, Houghton Mifflin, sources said. Vivendi bought Hougton for $2.25 billion a year ago.
A Vivendi spokeswoman declined to comment. A Lagardere spokesman could not be reached at press time.
Vivendi is trying to sell its publishing units as it looks to pay down its debt and possibly raise cash to counter a move by German phone company Vodaphone Group for control of its stake in French phone company Cegetel.
By holding a new auction for Houghton, the Boston publisher of “The Lord of the Rings” trilogy and “The Curious George” children’s book series, Vivendi hopes to widen the process and attract higher bids.
The move to sell the publishing assets separately comes after three bidding groups submitted disappointing offers of between $2.6 billion and $3 billion for all of VUP. They had previously hoped to receive as much as $4 billion. Lagardere, which owns Hachette Livre, the No. 2 book publisher in France, was among the bidders. Others included a group led by BNP Paribas’s investment arm, PAI, and Kohlberg Kravis Roberts & Co. and a team of Carlyle Group and French-based Eurazeo.