14 DAY TRIAL // Comcast, the greatest US cable and Internet/broadband provider, and General Electric decided to pool their resources, each contributing with their services, networks and finest technology in order to bring about the establishment of a leading media and entertainment company combining both partners' arrays of networks, such as MSNBC, CNBC, Bravo, E!, Versus and USA. The joint venture plan has been approved by the Comcast and GE Boards of Directors, but it still needs the regulatory approvals, which will likely take some time.
“This deal is a perfect fit for Comcast and will allow us to become a leader in the development and distribution of multiplatform 'anytime, anywhere' media that American consumers are demanding,” Brian Roberts, Comcast chairman and CEO, said. “In particular, NBCU's fast-growing, highly profitable cable networks are a great complement to our industry-leading distribution business. Today's announced transaction will increase our capabilities in content and cable networks. At the same time, it will enhance consumer choice and accelerate the development of new digital products and services.”
Global Electric is set to provide the joint venture with the NBCU business valued at $30 billion, as well as its unconsolidated investments of $9.1 billion, which NBCU will borrow from third-party lenders. To this, Comcast will add ten of its own regional sports and its cable networks, as well as $7.25 billion worth of digital media property. Comcast will own 51% of the total shares, whereas General Electric will hold the other 49%. The venture will be headed by the current CEO of NBCU, Jeff Zucker.
“The combination of Comcast’s cable and regional sports networks and digital media properties and NBCU will deliver strong returns for GE shareholders and business partners. NBCU has been a great business for GE over the past two decades.” GE Chairman and CEO Jeff Immelt added. “We are reducing our ownership stake from 80 percent to 49 percent of a more valuable entity. By doing so, GE gets a good value for NBCU. This transaction will generate approximately $8 billion of cash at closing with an expected small after-tax gain. We have many opportunities to invest in our high-technology infrastructure businesses at attractive returns. I believe that the new NBCU will deliver value for both Comcast and GE in the future. We will give consumers and advertisers more choice and our cable and digital assets will be second to none. I am confident Brian Roberts and his team at Comcast will be great partners.”