VIVENDI READY TO PULL TRIGGER

Wake us when it’s over.

The auction for Vivendi Universal's entertainment businesses nears its conclusion as the French company’s board meets to weigh bids from the two final suitors, General Electric 's NBC and a group led by investor Edgar J. Bronfman Jr.

Insiders seem to feel NBC has an edge in the long-running auction for the VUE properties, which include the Universal film and TV studios, three cable TV networks and theme parks.

Bronfman, who once controlled the Universal properties as chief executive of Seagram Co., spent the weekend trying to get back into the picture, but critical comments he made to the Financial Times about VU’s actions during the auction process seems to have hurt him with the board.

An investment banker close to Bronfman told Dow Jones Newswires his consortium has all but lost the bidding for VUE.

Vivendi had been hoping to fetch $14 billion for the Universal assets to pay down huge debts run up under former chief executive Jean-Marie Messier. All but the final two potential suitors have dropped out, saying the price was too high.

After a board meeting in Paris last week, Vivendi said an eventual agreement with either NBC or the Bronfman group would leave the French company with a "substantial'' stake in a U.S. media group. It also said it would explore a public offering for the entertainment assets.

NBC has long been rumored to be hunting for a Hollywood production studio for access to programming. It is the only TV network not to be connected to one. CBS is owned by Viacom, ABC is part of the Walt Disney Co., and Fox is part of News Corp.

Some of the bidders for VU’s entertainment properties included cable TV mogul John Malone of Liberty Media Corp., investment tycoon Marvin Davis, Viacom and MGM.

The Bronfman-led group includes Thomas H. Lee Partners, a private equity fund, and Charles Dolan’s Cablevision Systems Corp., a cable TV company in New York that owns AMC, the Independent Film Channel and WE: Women's Entertainment channels, as well as Madison Square Garden, the Knicks and the Rangers.

Under the proposed merger with NBC, Vivendi would retain a 25% interest in a combined operation that would join the two companies’ holdings, and have the option of cashing out within the next few years or participating in an IPO of the unit. The GE offer does not involve cash up front. Bronfman’s bid included at least $8 billion in cash for a majority stake, valuing the company at $12 billion, less than the $14 billion price tag Vivendi was seeking.

Even if NBC is designated as the finalist, there are still a host of issues to resolve, including GE providing guarantees to protect Vivendi from financial losses if the joint venture doesn’t pan out. Another factor is former VUE Chairman Barry Diller, whose company holds numerous restrictions and controls that limit future buyers’ ability to manage the assets.