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Is Vivendi ready to bid au revoir to NBC Universal?

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French media company Vivendi may need some extra cash -- and that comes as good news to General Electric Co.

GE has been negotiating to sell its majority stake in NBC Universal to the nation’s largest cable operator, Comcast Corp. But before GE can march down the aisle with its new amour from Philadelphia, GE’s partner in the venture for the last five years, Paris-based Vivendi, would have to agree to file for divorce.

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And that’s where a Brazilian phone company comes in. Vivendi acknowledged over the weekend that it finally prevailed in its months-long bid to acquire a controlling interest in GVT, a Brazilian telecom firm, for $4.2 billion. A few weeks ago it appeared that Vivendi would be foiled in its pursuit of GVT and, therefore, would be in no hurry to unload its stake in NBC Universal.
But now, with a sizable acquisition to finance, it seems more likely that Vivendi will announce in the coming days that it intends to exercise its option to sell its 20% stake in NBC Universal. Vivendi could use the money -- expected to be at least $5 billion -- to underwrite the purchase of the GVT shares.

NBC Universal insiders expect the Comcast takeover to be announced this week.

Under the proposed deal, Comcast would contribute its entertainment channels -- including its nine regional sports networks, E!, Versus, Style and the Golf Channel -- and about $4 billion to $6 billion in cash for 51% control of the new entity.

GE, meanwhile, would contribute all of NBC Universal. It would receive 49% of the joint venture and a payment of about $9 billion, which the new entity would take on as debt.

The deal on the table also would allow Comcast to use cash flow from the joint venture to buy out GE within eight years, according to people familiar with the discussions.A Vivendi spokesman declined to comment, as did a spokeswoman for GE and a spokeswoman for Comcast.

-- Meg James

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