The struggling media giant Vivendi Universal has sold its 50% stake in European internet portal Vizzavi to joint venture partner Vodafone for 142.7m euros (£90.4m; $140.5m).
The joint venture was set up two years ago, in return for Vivendi helping Vodafone to win the takeover battle for German mobile phone company Mannesmann.
Vizzavi was supposed to provide Vivendi’s and Vodafone’s 86 million “mobile customers” with news, entertainment and internet services across three platforms – online, television and mobile phones.
Both firms pumped millions of euros into the venture, but the slow roll-out of web television and high-speed mobile internet services hampered expansion plans and kept usage relatively low.
The sale will provide Vivendi with much needed cash. Saddled with debt, the company came close to bankruptcy earlier this year, and now has a new management.
The French company said getting rid of its stake in loss-making Vizzavi would save it 171m euros in the 2002/03 financial year.
Meanwhile Vodafone hopes that Vizzavi will break even this year.
The key revenue driver will be Vodafone’s new consumer package, called Vodafone Live.
Set to launch in the autumn, the service is likely to follow the example set by T-Mobile and Orange and allow Vodafone customers to e-mail pictures through mobile phones and other internet services.
The deal, however, also results in the break-up of Vizzavi’s European network.
Vizzavi France will stay with Vivendi, while the rest of Vizzavi – operating in Germany, Spain, Italy, Greece, the Netherlands, Portugal, and the UK – will continue to serve Vodafone customers.
However, the French multi-media portal will continue to receive technical support from its European sister operations, and benefit from Vizzavi’s research and development.
What remains of Vizzavi Europe will employ 450 people.