IAC/InterActiveCorp

(IACI)

sold its remaining interest in Vivendi Universal Entertainment back to

General Electric

(GE) - Get Report

and

Vivendi Universal

(V) - Get Report

for $3.4 billion.

Barry Diller's Internet conglomerate got back $1.4 billion worth of its own stock plus cash and advertising rights in return for its 5.4% common interest and a separate preferred stake in Vivendi Universal Entertainment. The venture was created three years ago to house the entertainment assets of IAC and Vivendi Universal Studios.

IAC and Vivendi agreed to end litigation over whether IAC deserved money to cover taxes related to its preferred shares. Vivendi Universal also received a one-year extension on the deadline for a decision on whether it wishes to retain its 20% stake in NBC Universal, which was set up last year with GE.

Diller, who said his company will record a $330 million after-tax gain on the divestiture, said the deal made sense from a valuation perspective.

"The transaction results in after tax proceeds to IAC that, by any measure, exceed the company's publicly stated valuation of the VUE securities," Diller said in a statement. "After paying applicable taxes on the transaction, IAC will have netted approximately $1 billion in cash, repurchased 56.6 million IAC shares, and obtained approximately $100 million in advertising across NBC-Universal's various networks over the next three years."