The Good Faery (alstaria) wrote in ontd_political,
The Good Faery
alstaria
ontd_political

It's official: Comcast buys controlling interest in NBC Uni from GE

NEW YORK - Comcast and General Electric Co. agreed to a deal under which Comcast will take a 51 percent share of NBC Universal, CNBC's David Faber reported, citing sources close to the situation.
"There's nothing left but to process paper," Faber said a source told him, adding that the two companies would announce the agreement on Thursday.

The news comes hours after GE agreed to pay reportedly $5.8 billion to buy out the 20 percent remaining portion of NBC Universal it doesn't already own from French media conglomerate Vivendi SA.

(Msnbc.com is a joint venture of Microsoft and NBC Universal.)

Comcast, which is based in Philadelphia, is expected to pay GE about $5 billion to $7 billion in cash and contribute about $6 billion to $7 billion worth of cable channels it owns, such as E! and Style, into a new NBC Universal joint venture. GE would transfer about $8 billion to $10 billion in debt to the joint venture. GE, which is based in Fairfield, Connecticut, and acquired NBC in 1986, would own a 49 percent stake in the new NBC Universal but is expected to completely divest its holdings after several years.

An agreement was supposed to have been announced weeks ago, but GE's talks with Vivendi have been taking longer than expected.

Comcast's agreement with GE has been set and wasn't expected to be affected by whatever price GE ends up paying Vivendi. The Wall Street Journal reported that GE would pay $5.8 billion for the stake.
A GE spokeswoman declined to comment late Monday.

Vivendi acquired a 20 percent stake in NBC in 2004 after the French company agreed to merge its Vivendi Universal Entertainment business with GE's NBC. Vivendi was trying to sell off some of its businesses after running up billions of dollars in debt in a buyout binge.

Comcast wants NBC Universal largely for its lucrative cable channels, such as Bravo and CNBC. NBC Universal also spans the NBC and Telemundo broadcast networks, the Universal Pictures movie studio and Universal theme parks.

Comcast is eager to diversify its holdings amid an encroaching threat from online video and more aggressive competition from satellite and phone companies that offer subscription TV services.
Although the deal holds the promise that movies could reach cable TV more quickly after showing in theaters, and that TV shows could appear faster on cell phones, it has already raised concerns that Comcast would wield too much power over entertainment.

Shares of GE rose 6 cents to $16.08 in midday trading while Comcast was up 14 cents to $14.80. But cable investors haven't been happy with the expected acquisition — Comcast has lost more than $6 billion in market value since reports of the deal first leaked on Sept. 30.


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