General Electric Co is considering several scenarios for the future of NBC Universal, to be ready for the possibility that its minority partner Vivendi SA chooses to sell its 20 percent stake.
Vivendi has been a great partner. They've got a window every year to review their options for NBC and this year we wanted to be ready for several scenarios, GE Chief Executive Jeff Immelt told investors on a conference call on Friday.
The largest U.S. conglomerate is considering the possibility of spinning off the media arm through an initial public offering or taking on another partner, Immelt said.
According to sources, No. 1 U.S. cable company Comcast Corp has been in talks with GE about taking a stake in that business. Immelt did not name that company, but said the level of interest in NBC is logical, just given the process that Vivendi goes through each year.
The French media company has an annual option to sell its NBC Universal stake from November 15 through December 10.
Immelt also noted that GE has long faced calls from investors to consider selling the media business, which were loudest when NBC profits were declining. In the just-ended third quarter, NBC turned in one of GE's strongest divisional performances, recording 13 percent profit growth.
When GE put its appliance unit on the block last year, it also held out the possibility of holding an IPO for that business. In the end, it opted to keep the unit as the economy went into a sharp slump.
Investors have said that a GE sale of some or all of its NBC stake could help the company avoid having to raise additional capital through a stock sale, should losses at its GE Capital finance arm rise above its forecasts. GE officials have repeatedly said they do not expect to need to raise additional equity.
I don't have a specific need for cash, Immelt said.