NBC

1
NBC VUE Combine Assets in Forming NBC Universal
Joint Venture
2
Methodology

• Step 1 Estimate total value of joint venture
• Step 2 Estimate value of assets contributed
• by each partner
• Step 3 Determine form of payment
• Step 4 Determine ownership distribution

3
Step 1 Value Combined Assets of Joint Venture

• 3 billion EBITDA (EBITDA of contributed assets)
• GE contributes 2 billion of EBITDA VUE
  contributes 1 billion of EBITDA
• 14 (Comparable entertainment company multiple)
• Relative valuation method
• 3 billion x 14 42 Billion

4
Step 2 Calculate Value of Each Partners
Contribution to the Joint Venture
Vivendi
General Electric
14 Billion (1/3 of 42 Billion)
28 Billion (2/3 of 42 Billion)
Value of Combined GE and VUE Assets 42 billion
5
Step 3 Form of Payment to Vivendi

• 4.0 billion (GE stock)
• 1.6 Billion (Assumed Vivendi debt)
• 8.4 billion (Value of Vivendis equity position
  in NBC Universal)
• 14.0 billion (Purchase price paid to
  Vivendi for VUE assets)

6
Step 4 Determining Ownership Distribution At
Closing

• Vivendi chooses to receive cash infusion at
  closing 5.6 billion (i.e., 4 billion in cash
  in lieu of GE stock 1.6 billion in assumed
  Vivendi debt)
• Vivendis ownership in NBC Universal
• (14B - 5.6B)/42B 8.4B/42B 20
• At closing
• GE ownership 80
• Vivendi 20