GE, Vivendi near NBC Universal deal - reports

General Electric is close to clearing a major hurdle in its path to sell control of entertainment giant NBC Universal to Comcast, according to published reports Monday.

GE has reached a tentative deal to buy Vivendi SA's 20% stake in NBC Universal for $5.8 billion, the reports say.

The current agreement is reportedly the result of face-to-face talks last week between GE chief executive Jeffrey Immelt and Vivendi's chief executive, Jean-Bernard Lévy.

The tentative plan values NBC Universal at around $30 billion, according to reports, setting the stage for a joint venture with GE, where Comcast would hold a reported 51% stake in what would be one of the world's biggest media companies.

A final deal could reportedly come this week, but many details still need to be hammered out.

A representative for GE would not comment on the reports, and representatives from Vivendi and Comcast could not immediately be reached for comment.

Rumors of a long-awaited GE/Comcast deal first surfaced in early October and have been said to depend on a sale of Vivendi's minority stake in NBC Universal.

The media group, which includes the NBC television network, Universal Pictures movie studio and the Universal theme parks, had been the target of spin-off speculation for many months. GE was never able to find synergies between NBC and its other, primarily industrial businesses, and many investors called on General Electric to shed the business.
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GE (GE, Fortune 500) bought NBC in 1985 for $6.3 billion. In May 2004, NBC and French telecom giant Vivendi Universal merged to form NBC Universal. GE owned an 80% stake in the media company and Vivendi owned 20%.

Vivendi had also been mulling an exit for some time. Under the deal's original terms, Vivendi has the annual right to divest its stake during a three-week window starting Nov. 15 each year.

GE's media unit has been struggling. NBC Universal reported an 11% drop in revenue and a 27% profit decline the first nine months of the year. Universal Studios had just one summer box office hit: "Inglourious Basterds," and attendance at the company's theme parks has been slipping. NBC has also been in the ratings toilet for several years.

But things aren't all bad at NBC Universal. Its cable networks are exceedingly strong, with USA gaining the top ratings of any cable network in the past quarter.

The SyFy network, CNBC and Bravo have also gained viewers, and MSNBC took over second place in the prime time cable news battle. Also, NBC's investment in digital media site hulu.com seems to be playing off, with strong growth in viewership and advertising content.

Comcast (CMCSA, Fortune 500), the largest U.S. cable company with nearly 24 million subscribers, has been looking to expand its content services for many years. Comcast also owns several cable networks, including entertainment network E!, the Style Network, the Golf Channel, Versus, G4, PBS Kids Sprout, TV One and Comcast Sports Group.

The company failed in an unsolicited bid to buy Walt Disney Co. (DIS, Fortune 500) for $54 billion in 2004, a deal that would have created the world's biggest media company.