General Electric Co. (GE) and Vivendi SA (VIV) have agreed in principle to a deal in which the former would buy the French company’s 20% stake in NBC Universal for $5.8 billion, valuing NBC Universal at $29 billion.

Vivendi had originally valued its 20% stake in NBC Universal, acquired in 2004, at $6.1 billion. But the two sides differed on that valuation, slowly narrowing their gap over the past few weeks. GE, which owns the remaining 80%, offered around $5.6 billion about 10 days ago.

Vivendi initially wanted the entire payment upfront, while GE wanted to pay after its deal with Comcast Corp. (CMCSA) closed. Vivendi had agreed to accept payment for one-third of its stake until the deal with Comcast closes.

As part of a proposed deal, NBC Universal would become 51% owned by Comcast and 49% by GE. Comcast would contribute around $4 billion to $6 billion in cash, as well as its collection of cable networks to pay for its stake. Under the terms of the proposed deal, the new company is expected to be able generate cash to pay down $9 billion in debt that would be added to its books as part of the agreement. Vivendi would use that debt to buy the rest of the company from GE.

Comcast had long wanted to buy media assets to create a content powerhouse spanning broadcast TV, cable and film.

GE operates as a technology, media, and financial services company worldwide. Its Energy Infrastructure segment produces gas, steam, and aero-derivative turbines; generators; and combined cycle systems, as well as provides water treatment services and equipment. GE’s NBC Universal segment engages in the production and distribution of films and television programs; operation of television stations and cable/satellite television networks, as well as theme parks. The company was founded in 1892 and is based in Fairfield, Connecticut. Its major competitors are United Technologies Corp. (UTX), Siemens AG (SI) and Citigroup Inc. (C).

We currently have a Neutral recommendation on GE.

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