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BSkyB falls as Vivendi sells stake
to fund US acquisition

LONDON - Shares in BSkyB fell more than 5% this morning, after Vivendi Universal confirmed it is to sell part of its stake in the UK satellite broadcaster for £1bn to help fund its US expansion plans.

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BSkyB fell 5.8% in early trading to 753.5p before pulling back slightly to 754p.

Vivendi has instructed Deutsche Bank and investment bank Goldman Sachs to sell 150m equity certificates in the satellite broadcaster. The certificates will be sold privately and not on the open market.

Vivendi said it would use the cash to explore "opportunities of strategic partnership in television and distribution in the US".

It is thought that the money will be used to finance a deal Vivendi chief executive Jean-Marie Messier is negotiating with USA Networks to buy its entertainment arm, USA Entertainment, which is run by former Channel 4 chief executive Michael Jackson.

In a statement, Vivendi said: "The proceeds will be used to cover financial needs arising from different strategic partnership opportunities in US television and distribution, which may or may not be finalised."

The equity bonds, exchangeable into BSkyB ordinary shares in October 2002, are being offered by Deutsche Bank and Goldman Sachs.

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