Vivendi's embattled chief executive Jean-Marie Messier faces his board of directors on Tuesday, in a potentially explosive meeting.

One day after Vivendi's shares fell 23% in Paris, Mr Messier suffered another blow when a key director, Bernard Arnault quit the board.

Arnault supported Messier in a previous meeting

Mr Arnault, head of the French luxury group LVMH, was seen as a supporter of Mr Messier during a stormy board meeting in New York last month.

Tuesday's meeting follows a partial sale of Vivendi Universal's stake in its utilities arm Vivendi Environnement.

The stake was reduced from 63% to 42% in a bid to reduce the parent company's debt pile of 17.5bn euros (�11.3bn; $17bn).

Market rout

However, the deal was not particularly well received in the markets, and pushed Vivendi Environnement's shares down by 11% on Monday.

Mr Messier is just a Vivendi employee and by any logic he should resign after such setbacks

Paris trader

The complex deal - involving numerous banks and a staggered sell-off - will eventually see Mr Messier cede overall control of Environnement.

After the parent company's 23% shares slide, on top of previous declines, Mr Messier will also be hoping to restore investor confidence.

There were some positive signs on Tuesday afternoon, as the company's shares clawed back ground.

Since the beginning of the year, however, the company's shares have lost about 70% of their value.

"Mr Messier is just a Vivendi employee and by any logic he should resign after such setbacks," said one Paris stock trader.

"He deceived everybody, especially the analysts."

Hanging on

Mr Arnault declined to comment on his departure from Vivendi's board, but there were rumours that he was concerned about getting tangled up in any kind of corporate scandal.

For his part, Mr Messier has remained defiant despite widespread criticism of his management skills and corporate strategy.

Up until now, he has also managed to survive several board meetings.

Vivendi Universal is the second largest media company after AOL Time Warner of the US.