SEPTEMBER 5, 2003
POWER LUNCH
By Ronald Grover
Bob Wright's Post-Vivendi Schmoozathon | For the NBC chairman, the megadeal was just the start. Now, he's making the rounds, intent to assure any and all that it's a good pact
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NBC Chairman Bob Wright is one hot property, having slogged through Vivendi Universal's three-month auction to strike the deal of his life. General Electric's (GE ) NBC unit will merge with Vivendi's (V ) studio, theme parks, and cable channels to form a media behemoth valued at north of $42 billion, with annual revenues in the range of $13 billion.
Now everyone wants some time with the slender, balding media mogul. Rumbling through the cavernous NBC studio in Burbank, Calif., on Sept. 3, he's headed for a three-minute spot on KNBC's 5 p.m. newscast. Jay Leno wants a few minutes before he starts filming The Tonight Show. Even an NBC cameraman, rolling equipment into position as the newscasters banter, has a request. Thrusting a white baseball hat emblazoned with the GE logo at Wright, he asks for –- and gets –- his autograph.
The aftermath of a big deal, as Wright's whirlwind pace suggests, can be as arduous as the crafting of it. His job now: selling the virtues of the deal to the constituencies that can kill it –- the press, investor communities, even the executives who work for the company that will be merged into NBC.
CUTS TO COME. The odds are this deal won't come unstuck, though. The benefits for both sides are just too good. NBC gets cable outlets for its programming, a massive library of older films, and a film and TV studio. Vivendi gets a blue-chip operator for assets it admitted it didn't have a clue how to run.
Wall Street seems to like the merger, too. In the days after the deal was announced, the stocks for both Vivendi and GE traded up, a rarity in the aftermath of the AOL-Time Warner (AOL ) hookup. "The combined entity enjoys a complementary set of assets with an opportunity to unlock significant value on each side," Merrill Lynch analyst Jessica Reif Cohen wrote in a Sept. 3 report.
Just the same, Wright & Co. aren't taking any chances. Campaigning just as hard as one of the 135 candidates seeking the California governorship, he chatted up the press in New York right after the deal was announced Sept. 2. He then jumped aboard GE's Gulfstream jet with Vivendi Chief Operating Officer Jean-Bernard Levy to do it all over again in Los Angeles. There, meeting with 175 of Vivendi Universal's top music, film, and TV executives, Wright did his best to calm the nerves of troops who know that at least some of them will be facing the ax.
STICKING AROUND. "We don't own the company yet, so I'm not getting into the games of what we're going to do," Wright tells me as he hustles through the NBC corridors on his way to his KNBC gig. Even so, the exec says his team has identified roughly $400 million in cuts that can be made over the next three years. Some 75% of the $400 million are likely to come from reduced overhead, figures Merrill's Cohen. Wright won't quibble with the number.
What about the talk of cutting at least $100 million by consolidating NBC's in-house TV production with the operations of USA's TV studio –- home to the Law & Order shows that air on NBC? Wright won't go there. "If I start talking about things like that, very good people start walking out the doors," he says.
The big question is what will happen to Ron Meyer, the super-smooth Vivendi Universal president who has had a hot summer with such money-earners as the Jim Carrey smash Bruce Almighty and car-racing hit 2 Fast, 2 Furious. Meyer says he's staying, and as if to prove his point, he made the rounds with Wright during the NBC chief's tour of the Burbank digs.
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Copyright 2003, by The McGraw-Hill Companies Inc. All rights reserved.
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