Business

Saturday October 3, 2009

GE looks at partnership or IPO for NBC Universal


NEW DELHI: General Electric Co (GE) is holding discussions on partnerships or an initial public offering (IPO) for its NBC Universal unit, chief executive Jeffrey Immelt said, as expectations grow about a deal with cable operator Comcast Corp.

“Discussions are ongoing whether it is an IPO or another partnership,” Immelt told reporters yesterday in response to a question on whether GE was talking to Comcast to sell a stake in NBC Universal (NBCU).

On Thursday, sources told Reuters that GE and Comcast were discussing a deal under which the largest US cable firm would take control of 51% of NBCU with GE keeping the rest.

GE, which owns 80% of NBCU, is said to be pondering its options for the fourth-place TV network and ailing movie studio as its partner, Vivendi, draws closer to a decision on whether to unload its 20% stake.

GE has the right of first refusal to pick up Vivendi’s stake if the French company exercises its annual option to sell.

Immelt declined comment when asked if GE was planning to buy Vivendi’s stake.

In Paris, a Vivendi spokeswoman declined to comment on the group’s plans for its NBCU stake. She also declined to comment on a Wall Street Journal report that said Vivendi’s board would meet on Oct 16 to decide whether to ratify the company’s plan to buy Brazilian telecom group GVT for US$2.9bil.

There has been speculation that Vivendi may also discuss the NBCU stake at the meeting.

Sources close to the matter said the Oct 16 date was circulating because it was the deadline for having completed due diligence on the GVT deal.

Analysts said a sale of its NBCU stake would allow Vivendi to continue to expand in emerging countries and to buy out minority investors in Canal Plus France, its pay-TV business. Unlike NBCU, Canal Plus is viewed as a key business for Vivendi.

“Vivendi has consistently stated that NBCU is non-core, but we think Vivendi will only sell if they have something to buy,” UBS analysts said in a research note on Thursday. — Reuters

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