Shareholders of Seagram Co. Ltd. will raise a glass to the historic company for the last time at a reception following the final annual meeting of the liquor-and-entertainment giant on Tuesday.
Sam Bronfman, the Prohibition-era bootlegger who founded Seagram 76 years ago, would probably have chafed at seeing the company disappear, but his family has held on to Seagram to the third generation - and will get even richer from the disposal.
Shareholders will follow the leadership of the Bronfman family, owners of 24 per cent of the company, and vote to turn over their shares to Vivendi SA of France.
Vivendi shareholders in Paris will meet the same day to ratify the $33.6-billion (U.S.) merger, and the deal, announced last June, will likely wind up this week.
Right after Edgar Bronfman Jr. was named chief executive, Seagram took a controversial new direction in 1995, selling its profitable stake in chemicals giant DuPont to invest in entertainment.
This week will be the culmination of that strategy, as Seagram's Universal Music Group, the world's largest music company, and its Universal Films unit will combine with Vivendi, which owns European television company Canal Plus and other media interests.
Seagram analyst Christopher Dixon with PaineWebber is sympathetic about the loss of Seagram. "No question, it has been a very important part of Canada," Mr. Dixon said from New York.
"But by the same token there's no question that the shareholders who invested in Seagram when Mr. Bronfman [Jr.]came on board have been very well rewarded."
The Bronfman family will own 7.5 to 8 per cent of Vivendi Universal and have three seats on the board - Seagram chairman Edgar Sr., his brother and co-chairman Charles and son Edgar Jr. - along with two other Seagram appointees.
Edgar Jr. will be vice-chairman of Vivendi Universal and will take charge of the music and new-technologies arm. It will be the world's second-largest media group after America Online-Time Warner.
"Edgar Bronfman Jr. has done a superb job of re-engineering this company and taking it out of some of the old bricks-and-mortar business and into the modern communications age," Mr. Dixon said.
"The opportunity to combine Universal, the film business, and the music business with a leading company the size and scale of Vivendi represents an extraordinary opportunity for Seagram shareholders."
Vivendi chairman Jean-Marie Messier will be chairman of the combined company. Canal Plus shareholders will give the final verdict on Friday to sell their remaining shares to Vivendi for about $12-billion (U.S.).
Although Seagram was a Canadian company, it has been managed from New York for years. Some 60 people work at the head office in an old stone mansion in downtown Montreal, but they mostly oversee the Canadian operations, which account for only 2 per cent of Seagram's $26-billion (U.S.) in worldwide holdings.
These include two bottling plants in the Montreal area, one at Amherstburg, Ont., and a distillery at Gimli, Man. The first distillery to hold the Seagram name, built in 1857 in Waterloo, Ont., and bought in 1928 by Sam Bronfman, was closed in 1990.
The liquor business, synonymous with the Seagram name, is for sale, and the owners are studying secret bids. It is valued by analysts at $9-billion to $11-billion (U.S.), and a buyer is to be announced by the end of the year.
Two contenders are known: Allied Domecq PLC of Britain and a joint bid by Diageo PLC of Britain and Pernod Ricard of France. Brown-Forman Corp. of Louisville, Ky., and Bacardi Ltd. of Bermuda are also reported to have placed bids.
The liquor business is the third largest in the world, with sales of $5-billion (U.S.) from brands including Chivas Regal and Glenlivet Scotch, Crown Royal and Seagram's V.O. Canadian whiskies, Captain Morgan rum, Don Julio tequila and Martell cognacs.