GE in deal to sell NBC to Comcast

03 Dec 2009

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General Electric and Comcast Corporation, the largest cable-TV operator in the US today signed a definitive agreement to form a joint venture that will give the cable company eventual control of NBC Universal (NBCU) and thereby create a leading entertainment company.

GE has agreed to acquire Vivendi SA's 20-per cent stake in NBCU for $5.8 billion, clearing the path for the company to sell control of the entertainment giant to Comcast.

Under the terms of the transaction, 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 to third party lenders.

Comcast will contribute 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, and make a payment to GE of approximately $6.5 billion of cash subject to certain adjustments based on various events between signing and closing.

NBCU has obtained $9.85 billion of committed financing through a consortium of banks led by J P Morgan, Goldman Sachs, Morgan Stanley, BofA Merrill Lynch and Citi. This financing is expected to receive solid investment-grade ratings from S&P and Moody's.

GE said that the transaction has been approved by the board of directors of GE and Comcast. It is subject to receipt of various regulatory approvals, including clearance under the Hart-Scott-Rodino Antitrust Improvements Act, and approvals of the Federal Communications Commission and certain international agencies.

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