WATFORD, England - NBC Universal could be floated on the stock market if France's Vivendi decides to sell its 20 percent stake in the group majority-owned by General Electric Vivendi's chief executive said.

Why not? Jean-Bernard Levy said when asked at a media conference on Tuesday whether an initial public offering would be an option for the U.S. entertainment group, adding that it would likely be in New York.

It was part of the thinking we had back in 2003 when we created NBC Universal that maybe when Vivendi would exit, one way ... would be through a flotation on the stock market and maybe that is what will happen, he said.

French media group Vivendi has an annual window beginning in mid-November to decide whether to sell the stake to GE. Levy declined to say whether the company was leaning towards a sale this year.

We have said repeatedly it is not a core part of Vivendi but we make no further comment, he said at the British government-sponsored c&binet conference in Watford near London.

Sources close to the discussions have said GE is negotiating a sale of a majority stake in NBCU to cable operator Comcast to create a powerhouse spanning TV broadcast, cable networks, movie and theme parks worth about $30 billion.

Such a deal would depend on Vivendi's selling its stake.

NBC Universal is an incongruous asset for GE, whose portfolio includes aircraft engines and power turbines.

Levy declined to say whether Vivendi would be prepared to raise its $3 billion offer for Brazilian telecoms operator GVT, after Spain's Telefonica trumped it with an unsolicited bid of $3.7 billion.

The asset would fit very well with Vivendi's strategy, Levy said. We haven't yet formally bid. We are reviewing the situation right now.

Vivendi has a long-standing policy of not engaging in bidding wars for takeover targets. (Reporting by Georgina Prodhan and Kate Holton; Editing by Jon Loades-Carter)

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