NBC to continue to Zuck

By Reuters

Comcast Corp  andGeneral Electric Co have agreed to make NBC UniversalCEO Jeff Zucker the head of their proposed joint venture, butthe structure of a new board is still being negotiated, sourcesfamiliar with the matter said.

The two sides have been in talks to reach a deal that wouldgive Comcast a 51 percent stake in the NBC Universal venture,which would also house the cable networks now belonging toComcast. They recently agreed to value NBC Universal at about$30 billion, sources previously told Reuters.

Under the terms being discussed, Zucker will lead the newentity, with no clauses for him to leave after a specificperiod, the sources said on Tuesday. They spoke on condition ofanonymity because the details have not been made public.

Comcast declined comment. NBC did not return calls seekingcomment.

As part of the proposal, NBC Universal would become a jointventure, 51 percent owned by Comcast and 49 percent by GE.Comcast would contribute around $4 billion to $6 billion incash, as well as its collection of cable networks to pay forits stake.

There has been a lot of speculation about who would headthe new company, especially since Peter Chernin -- the formerpresident of News Corp -- has been advising Comcast.

The sources said Zucker would be chief executive, but nodecisions had been made on what role Chernin might play, ifany. Discussions about what the new board would look like areongoing, the sources said.

NEXT FEW DAYS CRITICAL

One of the sources said progress made in the talks over thenext few days are "critical" and would determine how quicklythe deal gets done.

Vivendi, which owns 20 percent of NBC Universal and has toagree to a deal, is in talks with GE and is determined to getthe best value for its investment. Those talks are progressing,but "going slow," one of the sources said.

Every year between mid-November and mid-December, Vivendihas to decide whether to exercise its "put" option to sell itsNBC Universal stake.

This year, Vivendi is eager to dispose of its stake, whichit acquired as part of a 2004 deal to create NBC Universal, andis negotiating the valuation with GE, sources have said.

Last week, Comcast and GE agreed on the valuation for NBCUniversal, ironing out what had been a key obstacle in talks.

The valuation -- and the amount that Comcast will end uppaying for NBC Universal -- are complicated, because the newcompany is expected to be able generate cash to pay down $9billion in debt that would be added to its books as part of thedeal. It would use that debt to buy the rest of the companyfrom GE.

GE has negotiated a redemption option that would give itthe right to redeem all or part of its stake in the new companyin exchange for cash at the three-and-a-half year mark and at aseven-year mark, sources have said.

Also, the terms of the deal now allow Comcast's cashpayment to be determined partly by NBC Universal's financialperformance, sources told Reuters this week.

If the unit's performance worsens between the signing ofthe deal and the closing, Comcast could end up paying less.

Comcast has long wanted to buy media assets to create acontent powerhouse spanning broadcast TV, cable and film. ChiefExecutive Brian Roberts said last month he would look at allopportunities in content.

Many of GE's shareholders have urged the conglomerate tooffload NBC Universal, whose broadcast and cable networks,movie studio and theme parks are considered misfits among GE'smostly industrial operations.