Comcast will buy the remaining half of NBCUniversal by General Electric (GE), in a $16.7 billion deal that underlines the importance of TV despite the the growth of internet video.
Comcast will acquire GE?s entire 49% common equity stake in the NBCUniversal joint venture for approximately $16.7 billion. Also, NBCUniversal will purchase from GE the properties used by NBCUniversal at 30 Rockefeller Plaza and CNBC?s headquarters in Englewood Cliffs, NJ for approximately $1.4 billion.
The acquisition accelerates GE's divestiture ahead of a redemption period that would have begun in July 2014 and solidifies Comcast?s position as a leading media and technology company.
The transaction is expected to close by the end of the first quarter of this year.
"This is an exciting day for Comcast as we have agreed to accelerate the purchase of NBCUniversal. The management team at GE has been a wonderful partner during the past two years and their support has been very valuable. Our decision to acquire GE's ownership is driven by our sense of optimism for the future prospects of NBCUniversal and our desire to capture future value that we hope to create for our shareholders," said Brian L. Roberts, Chairman and CEO, Comcast Corporation. "We believe the terms of the transaction are attractive and have planned for this event by taking a number of financial steps to prepare our balance sheet. We believe we are in a strong and unique position to continue to grow and build value in our combined company."
Comcast said it would finance the deal with $11.4 billion of cash on hand, $4 billion in debt owed to GE, $2 billion from its own credit lines and $725 million in preferred stock issued to GE.
Broadcast TV revenue rose 7 percent last year and as the advertising market has rebounded, Comcast's move makes sense as TV will most probably continue to be a really important part of the advertising picture for years to come.
As part of Comcast's takeover, NBC Universal changed its corporate logo to NBCUniversal - without the space.