If Comcast deal falls thru, other moguls await
If NBC Universal doesn’t fall into Comcast’s lap, there may be other suitors for the giant entertainment company.Separately on Friday, News Corp. chairman Rupert Murdoch and Liberty Media chief John Malone both said they were eyeing NBC U but weren’t in any discussions. “We’ll have a look at that deal to see what opportunities there are for us,” Murdoch said at News Corp.’s annual shareholders meeting in Gotham. Back in 2003, Liberty was one of a group of bidders that tried to buy Vivendi Universal Entertainment, as the company (minus NBC) was called then. GE, which already owned the broadcast network, was the winner. As of now, the process is entirely within GE’s control. It owns the majority of NBC Universal. The issue is that Vivendi owns 20% and may want to sell the stake this year for a hefty sum. GE is mulling what to do in case Vivendi exercises a put option that would force GE to buy the 20% stake or see it sold through IPO. Topper Jeff Immelt said Friday during GE’s third-quarter earnings conference call that he had “no announcement” on GE’s plans, which are dependent on a decision by Vivendi expected to come down some time in November. GE is in negotiations with cable giant Comcast on a deal that could see Comcast acquire a 51% stake in NBC Universal. But that deal is believed to hinge on Vivendi selling its 20% stake. As for its earnings, GE said NBC U’s profit rose 13% to $732 million for the three months ended Sept. 30. Revenue of $4.1 billion was down 27% from the year earlier, in part on weaker advertising. Execs said the scatter advertising market is strong. They noted the revenue figure includes a $1 billion bonanza from the Beijing Olympics, without which the number would have been flat year-on-year. And profits would have been squeezed without one-time items, such as a gain from the deal orchestrated last month that saw NBC U combine its 25% interest in A&E Television Networks, encompassing A&E, History and other channels, with Disney’s and Hearst Corp.’s interests in Lifetime (Daily Variety, Aug. 28). NBC U’s own cable nets, led by USA, drove the company’s growth. Studio revenue fell 20% to $1 billion on tough comparisons from the year before and a weaker-than-expected performance at the box office. Universal Studios chief Ron Meyer recently fired Universal Pictures co-heads Marc Shmuger and David Linde (Daily Variety, Oct. 6). GE’s total profits fell 44% to $2.5 billion on lower earnings at financial arm GE Capital. Immelt said the global economic environment is improving, but slowly, and a recovery will be gradual. “We see signs of life,” he said.
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