NBC to Buy Out, Close Down Internet Unit

General Electric Co.’s NBC television unit will buy the rest of NBC Internet Inc. it doesn’t already own for about $85 million and fold it into the company as NBC seeks to cut losses at the Web site.

NBC, owner of the top U.S. TV network among young adults and 38.6% of NBC Internet, will pay $2.19 for each share of NBC Internet, or NBCi, said spokeswoman Rebecca Tompkins. That’s 46% more than San Francisco-based NBCi’s price Friday.

NBC put more than $100 million in cash and assets into NBCi after combining NBC.com, the Xoom.com commerce site and Snap.com Web search site two years ago, NBC Chief Financial Officer Mark Begor said. The company had hoped to compete with the biggest Internet sites, such as Yahoo Inc. and Microsoft Corp.’s MSN. A decline in advertising on the Web put NBCi’s survival in doubt.

NBCi shares rose 64 cents to close at $2.14 on Nasdaq. The shares have plunged 98% from a high in January 2000.

The NBCi.com site lets users search the Internet, offers news and other information and online shopping. It also runs various contests and other events related to NBC-TV shows.

NBC Internet said it will start eliminating jobs as part of a January plan to reduce costs. The company has trimmed its work force to about 300 from more than 800 last year.

Most remaining jobs probably will be eliminated, Chief Executive Will Lansing said in an interview. NBCi’s headquarters and New York offices will be shut, he said. Remaining jobs will be moved to NBC’s offices in Burbank and New York, he said.

NBCi’s fourth-quarter loss widened to $245 million, or $3.89 a share, from $68.2 million, or $2.18, in the year-earlier period. Revenue almost doubled to $31 million.