March 19 (Bloomberg) -- Vivendi Universal SA's pay- television unit Canal Plus agreed to sell its stake in sports rights venture Sportfive for 260 million euros ($321 million) to further reduce debt and focus on its TV and phone businesses.

Canal Plus is selling its 46.4 percent stake in Sportfive, which promotes and manages TV rights for soccer clubs and leagues, to a new venture between Advent International Corp., a private equity company, and RTL Group, Paris-based Vivendi said. The transaction values Sportfive at 560 million euros.

Vivendi Chief Executive Officer Jean-Rene Fourtou, 64, has since June 2002 sold more than 10 billion euros of assets to reduce debt and revive earnings. Canal Plus' exit from Sportfive, founded by Jean-Claude Darmon, comes five days after it lost a broadcasting contract for the English Premier league to pay-TV business TPS, controlled by Television Francaise SA.

As part of the agreement, RTL, the broadcasting unit of Bertelsmann AG, is also selling its 46.4 percent stake in Sportfive to the new Advent-RTL joint venture. The venture will be 75 percent owned by Advent and 25 percent owned by RTL.

Shares in Sportfive jumped as much as 9 percent to 142 euros and traded at that level as of 9:06 a.m. in Paris.

Darmon will remain president of Sportfive. Talks are underway to determine the size of Darmon's stake in Sportfive after the transaction.

Sportfive was created in 2001 when RTL, Canal Plus and Groupe Jean-Claude Darmon combined their sports-rights businesses.

Shares of sportfive were suspended in Paris. They last traded at 142 euros, 9.2 percent higher than yesterday.

Cable Merger

Separately, Canal Plus and France Telecom SA said they agreed to merge their cable TV assets and to seek a new shareholder for the combined business.

Canal Plus plans to hold a stake in the new business, while France Telecom, , the nation's biggest phone company, plans to cut its holding in cable assets, the companies said in a statement.

The joint company would combine Vivendi's NC Numericable, a subsidiary of Canal Plus, with France Telecom's FT Cable, totaling 1.7 million subscribers.

To contact the reporter on this story: Cecile Daurat in London at at cdaurat@bloomberg.net.

Last Updated: March 19, 2004 04:32 EST