Understudy Mulligan Ready for His Big Role

Brian C. Mulligan is digging in for the battle of his professional life: He wants Barry Diller’s job.

Mulligan is the mastermind behind oil tycoon Marvin Davis’ $13-billion bid for control of Vivendi Universal’s studios, theme parks, cable channels and recording labels. Associates say that Mulligan could take the operational reins now held by Diller if a deal is reached.

Unlike the showy Diller, Mulligan is a subdued, hard-working Hollywood money man who has resided on the edges of the top jobs that turn mortals into moguls.

He once served as co-chairman of Universal Studios and chief financial officer of Seagram Co. Last year, after only nine months on the job, Mulligan left under duress as chairman of News Corp.’s Fox Television, where he oversaw cable channels, TV stations and Fox Sports.

Insiders say he was unable to fit into the cutthroat, entrepreneurial culture that is News Corp.’s trademark. From the beginning, associates say, he was seen as an easy mark because he was new to the TV business. His underlings waged a virtual mutiny, refusing to return his phone calls and challenging his authority, according to Fox executives.

The 43-year-old Mulligan declined to comment.

Because his reputation is as a deal maker, rather than an operations manager, some question whether he has the leadership skills to run a major corporation. They say he seems to recognize that the fastest way for him to reach those heights is for Davis to buy Universal’s entertainment group, owner of the world’s largest music company, a leading movie studio and a television operation that includes the “Law and Order” franchise as well as the USA and Sci-Fi channels.

Few know the Universal assets better than Mulligan, who lives in La Canada with his wife and two young children.

He joined Universal in 1991 as a 30-year-old whiz kid controller. Well liked, he quickly rose through the ranks, doing stints in finance, corporate development and finally as the legendary studio’s co-chairman. In 1999, he became chief financial officer of Seagram Co., which by then had purchased Universal from Matsushita Electric Corp.

Mulligan and Seagram heir Edgar Bronfman Jr. negotiated the sale of Seagram to Vivendi. The new owners brought in their own management team, leaving Mulligan with few choices. He left one month later with four years left on his lucrative contract. His options package alone was valued at more than $20 million at the time.

“Very few people have anywhere near the knowledge that Brian has of USA, the music group and the studio,” said Blair Westlake, the former chairman of Universal Television who has known Mulligan since his earliest days at the company.

Mulligan began thinking about the takeover this summer after media reports that Vivendi might be forced to sell entertainment assets to reduce its debt. Friends say he contacted several private equity funds and financiers with entertainment backgrounds. One of them was Davis, a former owner of the 20th Century Fox Studio who still owns broadcast stations.

The two met for the first time in August at Davis’ Los Angeles offices. Mulligan described his vision for the takeover, the potential hurdles and solutions and the long-term prospects. Davis signed on, sending a formal proposal to Vivendi’s French owners the next month.

Two weeks ago, Mulligan met with top Vivendi executives in Paris to press Davis’ case. For the moment, the company is saying only that the sale is “not on the agenda.” Another meeting has been scheduled for January.

Many people at Universal are privately rooting for Mulligan. Diller is bearing down hard on costs, forcing the studio to conserve money by selling off certain rights to outside partners. He is expected to continue slashing overhead to ready the unit for a public offering.

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Worth more?

Marvin Davis is said to value Vivendi’s entertainment businesses at about $20 billion, but some analysts put the value as high as $26 billion.

Analysts’ estimated value of Vivendi’s entertainment assets (in billions)

Music -- $9.5

USA Networks (core channels) -- $8.6

Film/TV -- $5.0

Theme parks and recreation -- $2.0

Games -- $1.1

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Source: Merrill Lynch Capital Partners