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US cable giant Comcast takes controlling stake in NBC

Text by News Wires

Latest update : 2009-12-03

US cable giant Comcast announced on Thursday it had taken a controlling stake in NBC Universal, one of the biggest media entertainment groups in the world worth $30 billion, in a joint venture with General Electric.

AFP - US cable giant Comcast said Thursday it has taken a controlling stake in NBC Universal, one of the world's largest media-entertainment groups, in a joint venture with General Electric.
  
In a joint statement, the two companies said that their venture will be 51 percent owned by Comcast, 49 percent owned by GE, and managed by Comcast.
  
Comcast will pay approximately 6.5 billion dollars in cash "subject to certain adjustments based on various events between signing and closing," the statement said.
  
In addition, Comcast will "contribute its programming businesses and certain other properties valued at 7.25 billion dollars."
  
NBC Universal, valued at 30 billion dollars, is the world's fourth-largest media and entertainment company after The Walt Disney Co., Rupert Murdoch's News Corp. and Time Warner.
  
The joint venture would have debts of nine billion dollars.
  
The deal had been held up by French media conglomerate Vivendi, which said Thursday that it plans to sell its entire 20 percent stake in NBC Universal to GE for 5.8 billion dollars (3.8 billion euros).
  
In the deal, GE will purchase about 38 percent of Vivendi’s interest -- approximately 7.66 percent of all outstanding NBCU shares -- from Vivendi "for two billion dollars in September 2010, if the Comcast transaction is not closed by then."
  
GE will then buy the remaining 62 percent of Vivendi’s interest -- about 12.34 percent of all outstanding NBCU shares -- for 3.8 billion dollars when the transaction closes, the statement read.
  
The deal for Comcast comes five years after its failed 54-billion-dollar takeover bid for The Walt Disney Co.
  
The deal gives the cable giant one of the top Hollywood film studios, Universal Pictures, which has churned out a stream of Oscar-winning movies from "All Quiet on the Western Front" in 1930 to "To Kill a Mockingbird" (1962), "The Deer Hunter" (1978) and "Schindler's List" (1993).
  
Universal, incorporated in 1925, is one of the most storied names in Hollywood. It was merged with MCA in the 1950s and then sold in the 1990s to Canadian spirits group Seagram before being acquired by Vivendi, which was a French water utility firm.
  
NBC's cable and broadcast television holdings include flagship NBC -- the oldest of the four major US broadcast networks along with ABC, CBS and Fox -- financial news channel CNBC, 24-hour cable television news channel MSNBC, The Weather Channel, Bravo and Spanish-language broadcast network Telemundo.
  
Comcast operates several television channels including the Style Network, the Golf Channel and E! Entertainment Television, and is active on the Web with Fancast.com, an online video portal, movie ticketing service Fandango and online address book and social network Plaxo.
  
Comcast will attempt to break the curse of companies seeking to marry content and delivery, such as AOL and Time Warner.
  
Time Warner is in the process of spinning off its Internet unit AOL and has shed its cable holdings to concentrate on media and entertainment.
  
News Corp. sold its satellite television service DirecTV in 2008 to Liberty Media.
  
Comcast shares closed Wednesday up 0.42 percent at 14.08, but fell 1.06 percent to 14.03 in after-hours trade.
 

Date created : 2009-12-03

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