Investors in Viventures fund seek power change

Viventures II, the telecommuications and internet-focused venture capital fund launched by Vivendi Universal in June 2000 and managed by Viventures Partners, is the subject of a power struggle initiated by unhappy limited partners in the E500m partnership.

A group of investors, including Compagnie Nationale à Portefeuille, the investment company of Belgian investor Albert Frere and Californian investment fund Global Asset Capital, are attempting to take control of the fund’s management, according to French business daily Les Echos. The fund’s manager is thought to be against the proposal.

The newspaper reports that investors are unhappy at Vivendi’s decision, taken last August, to cease all investment into Viventures II, including follow-on investments. Frère and Global Asset Capital are said to have voiced their concerns at Vivendi’s continued management of the fund.

The fund closed with commitments totaling E638m in January 2001, although that total was later scaled back to E500m in June 2002 following the decline in the technology markets. Third party investors in the fund include Goldman Sachs, DLJ, SG Asset Management, Siemens Venture Capital, British Telecom, Cisco Systems and Mannesmann.

The Financial Times reports that Viventures II's stakeholders have reduced their commitments to just E210m, with only a quarter of the total capital invested to date.

Viventures Partners was set up to invest across Europe, the US and Asia in three continents and has offices in Paris, London, San Francisco and Singapore. The firm invests in telecom, optical components and systems, application software and enabling technologies for wireless and Internet infrastructure.