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Vivendi's Dead, Long Live Vivendi

CEO Jean-Bernard Lévy is a smooth operator who's reinventing the French entertainment company by moving it from movies to video games and music

With his French-tailored suit, near-perfect English, and 100-watt charm, you would never guess Jean-Bernard Lévy is something of a corporate undertaker. At 52, Léevy, chairman and chief executive officer of French conglomerate Vivendi (VIVEF), is well on his way to burying the image of his company as one of the biggest suckers ever to hit Hollywood.

Vivendi, the onetime water utility for the French city of Lyon, created back in 1853 by decree from Napoleon III, descended on the U.S. entertainment industry in 2000 with more money than smarts. Led by a dilettante French investment banker named Jean-Marie Messier, it jumped into the entertainment business by plunking down $3 billion for French theater chain Pathé (PTHZF) and its stake in Britain's BSKyB satellite service. Then it swooped in with a $41 billion deal to buy Universal Pictures parent company Seagram. By 2002, it was swimming in more than $20 billion in debt, and Messier, who had enjoyed the high life with an expensive home in New York, was sent packing. Lévy, a financial type appointed chief operating officer after Messier's departure, was named CEO three years later.