Thursday, December 3, 2009
G.E Agrees to Sell NBC to Comcast
By Eric Gursky
After many months of negotiations and publicity, the sale is finally complete. Comcast, the nations largest cable operator has reached and agreement to acquire NBC Universal from General Electric. This acquisition will allow Comcast to have a 51% majority ownership in NBC while G.E will attain a 49% ownership.
The deal is estimated to be valued at $30 billion. Under terms of the deal, Comcast will contribute its entertainment channels, including E and Versus; nine regional sports networks; and about $6.5 billion in cash in exchange for 51% of the new venture, which will continue to be called NBC Universal for the immediate future. G.E owned a 80% stake in NBC before the deal.
Chief Executive Officer of G.E Jeffery Immelt sees this NBC sale as an opening of new opportunities for G.E including but not limited to acquiring businesses in aviation and health care. After dividends and capital spending, GE will have $16 billion to $18 billion in discretionary cash next year. Immelt doesn’t expect to have to add capital to the GE Capital finance unit beyond the $2 billion in 2011 that may be required by an agreement between the division and the parent company.
For Comcast this is a win-win situation as it allows them to grow bigger and expand their markets while other media giants are shrinking. This deal is a perfect fit for Comcast and will allow them to become a leader in the development and distribution of multiplatform 'anytime, anywhere' media that American consumers are demanding.