Comcast, GE Try To Find A Price

Wall Street Journal

Comcast Corp. and General Electric Co. are wrestling over the value of NBC Universal in negotiations that would give Comcast control of GE's television and movie company, and an agreement could come within the next three weeks, people familiar with the talks said.

GE and Comcast executives held a series of sessions in New York last week, including presentations from NBC Universal executives on their units, people who attended the meetings said.

Those meetings completed much of the due diligence for a Comcast deal, some of those people said. The Comcast-GE talks could still fall apart.

Meantime, GE is exploring other options for NBC Universal, according to people familiar with the matter. GE and media company News Corp. are in preliminary conversations about an alternative NBC Universal deal, said a spokeswoman for News Corp., which also owns The Wall Street Journal. "It's a great set of businesses, and we're taking a look at it," she said.

One of the biggest outstanding issues for Comcast and GE remains the value of NBC Universal. It is central to a set of transactions that would merge Comcast's television networks with NBC Universal, creating a television and movie behemoth controlled by the nation's largest cable company.

In the transaction Comcast and GE are considering, Comcast would contribute cash and cable networks in return for an initial 51% of the expanded entity. GE, which now owns 80% of NBC Universal, would retain 49%. French telecom and media company Vivendi SA, which owns 20%, would be bought out.

Comcast has tried to pull NBC Universal's value down, minimizing the cash it would need to contribute to a deal, people familiar with the matter said. GE, citing rising media stock prices since summer, has pushed for an increase, they said.

Any Comcast deal could take a year or longer to clear regulators, people familiar with the talks said. Public interest groups and competitors of NBC Universal and Comcast also could urge lawmakers or regulators to put conditions on any deal.

A News Corp. deal would be tricky, too. Regulatory rules would prohibit News Corp., which owns the Fox broadcast network, from owning the NBC network. A person familiar with the matter said that any News Corp. deal would exclude NBC, local TV stations owned by NBC Universal and cable-news channel MSNBC. Dividing NBC Universal could make a potential deal more difficult, another person familiar with the matter said.

One person familiar with the talks said Comcast wasn't worried about talks with News Corp., calling them a GE negotiating tactic.

Any other potential deals could also face an uphill battle, given the momentum of the Comcast talks. GE and Comcast have been discussing the outlines of a deal since early spring, according to people with knowledge of the talks.

Brian Roberts, Comcast's chief executive, played a central role in pitching a potential deal to Jeffrey Immelt, GE's chief executive, a person familiar with the matter said. Another person described the role of Messrs. Roberts and Immelt in talks as "huge."