Bronfman Dives Into the Vivendi Mix

Talk about throwing good money after bad.

After arguably losing much of his family's fortune in the entertainment business -- first by purchasing a movie studio and record company, then by selling them for stock in Vivendi Universal (V - Cramer's Take - Stockpickr) -- Seagram scion Edgar Bronfman Jr. just can't get enough.

Vivendi Universal, which is trying to sell off its U.S. media businesses to help undo the damage done by former CEO Jean-Marie Messier, said Wednesday that Bronfman has told the company he intends to lead a consortium of potential purchasers of these assets.

Following a Monday meeting of Vivendi's corporate governance committee, the company says it reached a mutual agreement with the Bronfman family to suspend Vice Chairman Bronfman and his father, Edgar M. Bronfman, from board participation, and to put a hold on certain other agreements between Vivendi Universal on one side and members of the Bronfman family on the other.

Thus, Edgar Bronfman Jr. has a chance to live out the greater fool theory yet again. After he became the latest outsider to take a stake in the entertainment business -- first by purchasing control of the Universal movie studio and theme parks, then by purchasing the Polygram music label now known as Universal Music Group -- Bronfman seeks to buy some parts of these assets all over again from the once-mighty, now-fallen Vivendi Universal.

Shares in Vivendi Universal, which traded above $62 when the company was created in the December 2000 merger of the French utilities company Vivendi, the French TV network Canal Plus and the liquor/entertainment company Seagram, jumped $1.04 to $17.15 Wednesday upon news of the Bronfman consortium.

The sale of the entertainment assets, which current Vivendi Universal CEO Jean-Rene Fourtou is seeking as he regroups the company into a European-based telecommunications firm, promises to be a messy, complex affair whether or not Bronfman ultimately participates.