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COMPANY TOWN

GE appears ready to hand over control of NBC Universal to Comcast

Under terms of the deal, Comcast would pool cash and its cable channels into a new company that it would control with a 51% stake. GE would contribute NBC Universal and own 49%.

October 02, 2009|Meg James and Ben Fritz

Inside NBC, executives have spent the last six weeks putting together five-year forecasts of their business units for what they thought was going to be a public offering of Vivendi's 20% stake. Most had no idea that at the company's headquarters in midtown Manhattan top executives were negotiating a deal that could give Comcast control of the network and studio.

To be sure, the deal with Comcast could fall apart. Or Vivendi might decide to keep its stake in NBC Universal for another year. However, Vivendi Chief Executive Jean-Bernard Levy has told business associates that he would like to divest the company's 20% stake in NBC Universal to raise cash to expand its holdings in music, mobile communications or video games.

According to people familiar with the situation, GE would lend the joint venture $12 billion, money that would be used to pay Vivendi about $6 billion for its stake. The remaining $6 billion would go to GE as compensation for its equity in NBC Universal and the other entertainment assets. The joint venture would be a private company.

GE, NBC Universal and Comcast declined to comment.

"If electronic distribution is the key to the future, Comcast wants to make sure they have a central role in the distribution of movies and TV online through video on demand, and this should help in that regard," said Christopher Marangi, an analyst with Gabelli Asset Management.

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meg.james@latimes.com

ben.fritz@latimes.com

Times staff writers Richard Verrier, Dawn C. Chmielewski and Joe Flint contributed to this report.

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(BEGIN TEXT OF INFOBOX)

What they bring to the table

Comcast

Headquarters: Philadelphia

CEO: Brian L. Roberts

Founded: 1963

Ownership: Public

Business: Cable TV, Internet and digital phone services

Cable channels: E!, Style, Golf Channel, G4, Versus

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NBC Universal

Headquarters: New York

CEO: Jeff Zucker

History: Formed in 2004 through the merger of NBC and Vivendi Universal Entertainment

Ownership: General Electric 80%, Vivendi 20%

Key businesses: NBC, Telemundo, Universal Studios, Universal theme parks

Cable channels: CNBC, MSNBC, Bravo, USA, Syfy, Oxygen

Source: Company reports

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