Comcast and General Electric announced early this morning that they agreed to form a joint venture that will be 51 percent owned by Comcast and 49 percent by GE. The joint venture, which will consist of the NBC Universal businesses and Comcast’s cable networks, regional sports networks and more, will be managed by the newly formed Comcast Entertainment Group (CEG).
GE will contribute to the joint venture NBCU’s businesses valued at $30 billion, including its cable networks, filmed entertainment, televised entertainment, theme parks, and unconsolidated investments, subject to $9.1 billion in debt.
Comcast will put in its cable networks (including E!, Versus and the Golf Channel), its ten regional sports networks, and certain digital media properties, collectively valued at $7.25 billion. Comcast has also agreed to pay GE approximately $6.5 billion in cash. Former E! Networks President and CEO Ted Harbert will be heading the new entity, as he was recently promoted to President and CEO of Comcast Entertainment Group.
GE expects to realize $9.8 billion pre-tax in cash before debt reduction and transaction fees and after buyout of the Vivendi stake. GE expects to realize approximately $8 billion in cash after paying down the existing NBCU debt and transaction fees.
Headquarters for the business will remain in New York. The joint venture board will have three directors nominated by Comcast and two nominated by GE.
The transaction is subject to receipt of various regulatory approvals and other customary closing conditions, which is expected to be a very rocky road.