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. Last Updated: 07/27/2016

NBC Wins Bidding for Vivendi Universal

PARIS -- France's Vivendi Universal has announced a multibillion-dollar plan to merge its theme parks and glitzy Hollywood television and movie studios with U.S. General Electric Co.'s NBC unit.

The deal, announced Tuesday, would bring the businesses under the same corporate umbrella if final talks, as expected, result in an agreement by the end of the month.

Capping months of bidding for its prized U.S. entertainment assets, Vivendi eliminated a consortium including former Seagram chief executive Edgar Bronfman Jr. as it chose GE for a final round of exclusive talks.

For GE, the merger would expand an already vast empire into Hollywood filmmaking. Vivendi's U.S. show business assets include Universal Studios -- the producer of "The Hulk" and "Seabiscuit" -- as well as Sci Fi, USA and Trio cable channels, theme parks and Universal Television, the producer of "Law and Order." Vivendi, which has been hoping to trim mounds of debt, would land a big-name U.S. partner for its Hollywood properties at a time when it realized that managing them from Paris was unattractive.

At least five other companies, including some of the biggest names in the U.S. media world, had expressed interest in Vivendi Universal Entertainment when it went up for auction last spring.

Last week, Vivendi winnowed down the list to two -- GE and a consortium including Bronfman, who once controlled the Universal properties when they belonged to Seagram.

Bronfman, a Vivendi board member who suspended his activities with the French media company to mount a bid, led an eleventh-hour lobbying effort last weekend to salvage his offer, sources familiar with the matter said.

As part of the deal, GE would hold 80 percent of the combined company, and Vivendi would own 20 percent -- keeping a small hand in Hollywood. GE's vice chairman, Bob Wright, would head the company, which would have had revenue of some $13 billion in 2003.

In an interview Wright said it was a "pretty good bet" that the merged company would be called NBC Universal.

If the deal is closed, shareholders of Vivendi Universal Entertainment would receive $3.8 billion in cash and stock and $1.6 billion in debt reduction, Vivendi said.

Executives at both companies said they expect the deal to be finalized this month.

Vivendi's sober-minded chairman, Jean-Rene Fourtou, has led a fire sale of assets to clean up a dreadful financial picture at the company left by his flamboyant predecessor, Jean-Marie Messier.

Fourtou, who took over from Messier last year, has already sold Vivendi's publishing arm, Internet properties and art works in an effort to reverse its ailing fortunes.

By farming off the U.S. entertainment assets to GE, Fourtou is taking Vivendi farther away from Messier's costly vision of building an empire of music, film, mobile phone, television and Internet holdings.

Vivendi had hoped to sell the U.S. entertainment assets for about $14 billion. A source familiar with Vivendi's position said on condition of anonymity that "they've gotten" that amount.