GE Shows Weakness on NBCU

General Electric suddenly looks vulnerable in its negotiations with Vivendi over the French conglomerate's 20% stake in NBC Universal.
Author:
Publish date:

FAIRFIELD, Conn. (

TheStreet

) --

General Electric

(GE) - Get Report

suddenly looks vulnerable in its negotiations with

Vivendi

over the French conglomerate's 20% stake in NBC Universal.

At least, that is my reading of a

Bloomberg News

report late Monday headlined: "GE Said To Lean Toward IPO of Vivendi's NBC Stake."

GE is close to a deal to sell 51% of NBCU to Comcast, with GE retaining the other 49%, according to news reports. First, though, Vivendi must sell its 20% stake to GE. Though Vivendi has reportedly given several indications it wants out of NBCU, the two sides are apparently quite far apart -- $1 billion -- according to a

Financial Times

report last week.

Bloomberg

puts the difference at $500 million.

Bloomberg

's report looks to me like a rather obvious leak by GE or one of its bankers in an attempt to get Vivendi to back down on price. Realistically GE cannot risk an IPO of 20% of NBCU, as the move would force it to disclose far more details about how much the remaining 80% is worth than GE wants to provide. GE might get further putting pressure on Comcast to put in a little extra money as Comcast seems very eager to do a deal.

General Electric shares were off 6 cents to $15.97 in late morning action, while Comcast's stock was down a penny to $15.08.

For more on business trends affecting the future of television networks NBC,

CBS Corp.

(CBS) - Get Report

's CBS,

News Corp.

(NWS) - Get Report

Fox and

Walt Disney

(DIS) - Get Report

Co.'s. ABC network,

click here

.

--

Written by Dan Freed in New York

.