Hours after pulling out of the bidding for Vivendi Universal'sentertainment assets yesterday (14), cable giant Comcast said it was exploringthe launch of new cable channels and services with the French conglomerate.
It is understood any possible venture involving Comcast's cableexpertise and Vivendi content would not interfere with the sale, which is fastapproaching Monday's (18) deadline for second round bids.
Comcast's spokespeople refused to elaborate on its reasons forwithdrawing from the sale. It issued a terse statement yesterday that read,"Comcast announced today that it does not intend to bid for the VivendiUniversal Entertainment assets."
Analysts said one possible motive was to eliminate an "overhang"on the company's stock price caused by its perceived involvement in theauction. Shares were reported to have risen nearly $1 after the statement wasreleased.
Comcast agreed to sell its 58% stake in home shopping network QVCto John Malone's Liberty Media - a participant in the Vivendi auction - and isnow likely to devote its energies to the smooth integration of AT&TBroadband, which it acquired in 2002.
The withdrawal leaves General Electric as arguably the strongestcontender following MGM's exit from the process two weeks ago and cautionaryremarks from the remaining bidders.
Liberty Media, Viacom and the consortium led by Edgar J BronfmanJr have all indicated they are unlikely to meet Vivendi's minimum asking priceof $14bn.
Vivendi is selling off its entertainment assets to pay off massivedebts accrued under the former leadership of Jean-Marie Messier.
The assets upfor sale are Universal film and television studios, USA Network and SCI-FIChannel cable networks and the theme parks.