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8-K - FORM 8-K - COMCAST CORP | dp15775_8k.htm |
EX-2.1 - EXHIBIT 2.1 - COMCAST CORP | dp15775_ex0201.htm |
EX-2.2 - EXHIBIT 2.2 - COMCAST CORP | dp15775_ex0202.htm |
Exhibit
99.1
PRESS
RELEASE
COMCAST
AND GE TO CREATE LEADING ENTERTAINMENT COMPANY
Positions
Comcast and NBCU to Lead the Next Phase of Media Industry’s
Evolution
Builds
on Diverse Cable Portfolio, Accelerates Digital Offerings and Expands Customer
Choice
Entity
Will Deliver Strong Cash Flow With Conservative Capital Structure
NBCU
Businesses Valued at $30 Billion, Comcast to Contribute Businesses Valued at
$7.25 Billion
Comcast
To Own 51%, GE 49% Interest in NBCU
Jeff
Zucker to Lead New York-based Venture
_______________________________________________
PHILADELPHIA, PA and FAIRFIELD, CT –
Dec. 3, 2009 – Comcast (NASDAQ: CMCSA, CMCSK) and General Electric (NYSE:
GE) announced today that they have signed a definitive agreement to form a joint
venture that will be 51 percent owned by Comcast, 49 percent owned by GE and
managed by Comcast. The joint venture, which will consist of the NBC
Universal (NBCU) businesses and Comcast’s cable networks, regional sports
networks and certain digital properties and certain unconsolidated investments,
will be well positioned to compete in an increasingly dynamic and competitive
media and digital environment.
The combination of
assets creates a leading media and entertainment company with the proven
capability to provide some of the world’s most popular entertainment, news and
sports content, movies and film libraries to consumers anytime, anywhere. The
joint venture will provide consumers the broadest possible access to content,
and support high-quality, award-winning content development across all
platforms including film, television, and online. It will be anchored
by an outstanding portfolio of cable networks and regional sports networks that
will account for about 80 percent of its cash flow, including USA, Bravo, Syfy,
E!, Versus, CNBC and MSNBC. The joint venture will be
financially strong with a robust cash-flow-generation capability.
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.
Comcast Chairman
and Chief Executive Officer Brian Roberts said, “This deal is a perfect fit for
Comcast and will allow us to become a leader in the development and distribution
of multiplatform ‘anytime, anywhere’ media that American consumers are
demanding. In particular, NBCU’s fast-growing, highly profitable
cable networks are a great complement to our industry-leading distribution
business. Today’s announced transaction will increase our
capabilities in content and cable networks. At the same time, it will
enhance consumer choice and accelerate the development of new digital products
and services. GE has provided NBCU with a great home and has
dramatically and positively transformed the business. We are honored
that under this agreement Comcast would take over the stewardship of this
important collection of assets and are absolutely committed to investing in NBCU
and ensuring that it is a vibrant, financially strong company able to thrive in
a rapidly evolving marketplace by delivering innovative
programming. We are particularly pleased to be creating this new
joint venture with GE and Jeff Immelt and to have their continued
involvement.
“For Comcast, this
transaction is strategically compelling and will generate attractive financial
returns and build shareholder value,” continued Roberts. “It is also
expected to be immediately accretive and will also allow us to maintain our
strong commitment to returning capital to shareholders– all while increasing the
scale, capabilities and value of our cable distribution, content and digital
assets. Significantly, it is entirely consistent with our intense
focus on value creation and our disciplined strategy of pursuing profitable
growth in areas complementary to our distribution business.”
GE
Chairman and CEO Jeff Immelt said, “The combination of Comcast’s cable and
regional sports networks and digital media properties and NBCU will deliver
strong returns for GE shareholders and business partners. NBCU has been a great
business for GE over the past two decades. We have generated an average annual
return of 11 percent, while expanding into cable, movies, parks and
international media. We are reducing our ownership stake from 80
percent to 49 percent of a more valuable entity. By doing so, GE gets a good
value for NBCU. This transaction will generate approximately $8 billion of cash
at closing with an expected small after-tax gain. We have many
opportunities to invest in our high-technology infrastructure businesses at
attractive returns. I believe that the new NBCU will deliver value for both
Comcast and GE in the future. We will give consumers and advertisers more choice
and our cable and digital assets will be second to none. I am confident Brian
Roberts and his team at Comcast will be great partners.”
Comcast also
announced the creation of Comcast Entertainment Group (CEG), which will house
Comcast’s interest in the joint venture and will stand alongside Comcast Cable,
which operates the company’s traditional cable business.
Comcast Chief
Operating Officer Steve Burke said, "Both Comcast and NBCU have excellent track
records of integrating and growing multi-billion dollar businesses, including
significant content acquisitions. In addition, we have both developed
some of the country’s most popular programming and built many of the most
watched and valued networks in the industry. We are confident that
we’ll be even stronger together, and look forward to working with Jeff Zucker
and the NBCU team to deliver the best consumer experience.”
Jeff Zucker,
current president and CEO of NBCU, will be CEO of the new joint venture and will
report to Burke. Zucker said, “Combining the assets of NBCU, ranging from our
suite of cable properties and two
broadcast networks
to a legendary film studio and global theme park business, with the content
assets and resources of Comcast, will enable us to continue to thrive in an
ever-changing media landscape. Consumers of all of our products – on
screens large and small – will have the benefit of enhanced content and
experiences, delivered to them in new and better ways as a result of this
transaction. This marks the start of a new era for NBCU, and I'm genuinely
excited that I will be leading this wonderful organization, along with the
Comcast team, at this important time in our history.”
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.
Key Elements Of The
Transaction:
·
|
NBCU will
borrow approximately $9.1 billion from third-party lenders and distribute
the cash to GE.
|
·
|
NBCU, valued
at $30 billion, will be contributed to the newly formed joint
venture. Comcast will contribute its programming businesses and
certain other properties valued at $7.25
billion.
|
·
|
GE will
acquire Vivendi's 20% interest in NBCU for $5.8 billion. GE will purchase
approximately 38% of Vivendi’s interest (or approximately 7.66% of all
outstanding NBCU shares) from Vivendi for $2 billion in September 2010, if
the Comcast transaction is not closed by then. GE will acquire
the remaining 62% of Vivendi’s interest (or approximately 12.34% of all
outstanding NBCU shares) for $3.8 billion when the transaction
closes.
|
·
|
Comcast will
make a payment to GE of approximately $6.5 billion in cash subject to
certain adjustments based on various events between signing and
closing.
|
·
|
The new
venture will be 51% owned by Comcast and 49% owned by
GE.
|
·
|
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.
|
·
|
GE will be
entitled to elect to cause the joint venture to redeem one-half of its
interest at year 3 ½ and its remaining interest at year 7. The
joint venture’s obligations to complete those purchases will be subject to
the venture’s leverage ratio not exceeding 2.75X EBITDA and the venture
continuing to hold investment-grade ratings. Comcast also has certain
rights to purchase GE’s interest in the venture at specified times. All
such transactions would be done at a 20% premium to public market value
with 50% sharing of upside above the closing
valuation.
|
·
|
To the extent
the joint venture is not required to meet GE’s redemption requests,
Comcast will provide a backstop up to a maximum of $2.875 billion for the
first redemption and a total backstop of $5.750
billion.
|
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. The transaction is
also subject to other customary closing conditions. 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.
Comcast and GE
intend to submit regulatory applications supporting the pro-competitive and
strong public interest benefits of the transaction, including how the joint
venture will better meet the entertainment, communications and information needs
of the American public.
“We are prepared to
make affirmative commitments to ensure that the pro-consumer and public interest
benefits of the transaction are realized,” Roberts said. “Today, we have
announced a number of initial commitments that expand on the capabilities that
Comcast and NBCU have built over the years, and the new opportunities that this
combination makes possible. These commitments address the needs of various
audiences and stakeholders, and we will provide additional details on these and
other commitments in our public interest filing with the Federal Communications
Commission.”
Advisors
Morgan Stanley is
lead financial advisor to Comcast with UBS and BofA Merrill Lynch acting as
co-advisors. Davis Polk & Wardwell LLP is Comcast’s legal
advisor. J.P. Morgan is lead financial advisor to GE with Goldman
Sachs and Citi acting as co-advisors. Weil, Gotshal & Manges LLP
is GE’s and NBCU’s legal advisor.
Teleconference and
Webcast
Comcast will host a
conference call with the financial community today, December 3, 2009, at 8:30
a.m. Eastern Time (ET) to discuss this morning’s announcement with Comcast
Chairman and CEO Brian L. Roberts, Comcast Chief Operating Officer Stephen B.
Burke and Comcast Chief Financial Officer, Michael J. Angelakis. The conference
call will be broadcast live via the Company’s Investor Relations website at
www.cmcsa.com
or www.cmcsk.com.
Those parties interested in participating via telephone should dial (800) 263-
8495 with the conference ID number 44380493. A telephone replay of the
call will be available on the Investor Relations website starting at 12:30 p.m.
Eastern Time on December 3, 2009 and will be available until December 8, 2009 at
midnight Eastern Time. To access the rebroadcast, please dial (800)
642-1687 conference ID 44380493.
GE
will also host a webcast with the financial community today, December 3, 2009,
at 8:30 a.m. Eastern Time / 7:30 a.m. Central Time to discuss this morning’s
announcement with GE Chairman and CEO Jeff Immelt, GE Chief Financial Officer
Keith Sherin and NBCU President and CEO Jeff Zucker. The webcast will be
available at www.ge.com/investors. A
replay will be available later in the day on the site.
Additional media
materials are available at www.ge.com/newnbcu,
www.comcast.com/nbcutransaction
and https://www.nbcumv.com/mv/.
The description of
this transaction included in this press release is qualified in its entirety by,
and is subject to, the terms of the definitive documentation for the transaction
to be filed by Comcast with the Securities and Exchange Commission on a Current
Report on Form 8-K.
About
GE
GE
(NYSE: GE) is a diversified infrastructure, finance and media company taking on
the world’s toughest challenges. From aircraft engines and power generation to
financial services, medical imaging, and television programming, GE operates in
more than 100 countries and employs about 300,000 people worldwide. For more
information, visit the company's Web site at www.ge.com.
About
Comcast Corporation
Comcast Corporation (Nasdaq: CMCSA,
CMCSK) (www.comcast.com) is one of the nation's leading
providers of entertainment, information and communication products and services.
With 23.8 million cable customers, 15.7 million high-speed Internet customers,
and 7.4 million Comcast Digital Voice customers, Comcast is principally involved
in the development, management and operation of cable systems and in the
delivery of programming content.
Comcast's content networks and
investments include E! Entertainment Television, Style Network, Golf Channel,
VERSUS, G4, PBS KIDS Sprout, TV One, ten sports networks operated by Comcast
Sports Group and Comcast Interactive Media, which develops and operates
Comcast's Internet businesses, including Comcast.net (www.comcast.net). Comcast also has a majority ownership
in Comcast-Spectacor, whose major holdings include the Philadelphia Flyers NHL
hockey team, the Philadelphia 76ers NBA basketball team and two large
multipurpose arenas in Philadelphia.
About NBC
Universal:
NBC Universal is one of the world’s
leading media and entertainment companies in the development, production, and
marketing of entertainment, news, and information to a global audience. NBC
Universal owns and operates a valuable portfolio of news and entertainment
networks, a premier motion picture company, significant television production
operations, a leading television stations group, and world-renowned theme parks.
NBC Universal is 80% owned by General Electric and 20% owned by
Vivendi.
Combined
Assets/Properties
The assets and
properties owned or controlled by the new joint venture will include some of the
best known brands in the entertainment industry, including:
·
|
Several of
television’s most successful cable networks, including USA, Bravo, CNBC,
MSNBC, Syfy, E!, Style, Versus and the Golf
Channel;
|
·
|
One of the
nation's largest television groups,
including:
|
o
|
The NBC
Television Network;
|
o
|
Local
broadcast TV stations in ten top U.S. markets including New York, Los
Angeles, Chicago and Philadelphia;
|
o
|
The national
Telemundo Network and 16 Telemundo O&O stations in locations such as
Los Angeles, New York, Miami, Houston, Chicago and
Dallas/Ft.Worth;
|
·
|
Preeminent
television production operations that produce Emmy Award winning programs
like The Office,
30 Rock, Law &
Order, Heroes, Saturday Night Live and The Tonight Show, as well as
syndicate operations through NBC Universal Domestic and International
Distribution and a 3,000-title library of television
episodes;
|
·
|
NBC News, the
leading source of global news and information in the United States with
top-rated programs such as Nightly News with Brian
Williams, Today and Meet the
Press;
|
·
|
A robust
sports programming lineup featuring the Olympics (through 2012), NBC
Sunday Night Football, NHL/Stanley Cup, PGA Tour, US Open, Ryder Cup,
Wimbledon and the Kentucky Derby, Versus, Golf Channel and Comcast’s 10
regional sports networks;
|
·
|
Universal
Pictures, which has produced Academy Award winners Atonement, The Bourne
Ultimatum, Brokeback Mountain, Ray and A Beautiful Mind,
Focus Features, which recently produced Away We Go, and an
extensive movie library with more than 4,000 titles through Universal
Studios Home Entertainment;
|
·
|
Fast growing
digital media properties including CNBC.com, iVillage, NBC.com, Fandango,
and Daily Candy, which together generate more than 40 million unique users
each month;
|
·
|
Ownership of
theme parks in Florida (50% interest), California (100% interest) and a
financial interest in a theme park in
Japan;
|
·
|
A minority
interest in A&E, Biography, The History Channel, The Weather Channel,
Lifetime and Hulu.com.
|
Caution
Concerning Forward-Looking Statements
This
document contains “forward-looking statements” – that is, statements related to
future, not past, events. In this context, forward-looking statements often
address expected future business and financial performance and financial
condition, and often contain words such as “expect,” “anticipate,” “intend,”
“plan,” “believe,” “seek,” “see,” or “will.” Forward-looking statements by their
nature address matters that are, to different degrees, uncertain. These
statements are made on the basis of the views and assumptions of
management. Particular uncertainties that could cause actual results
to be materially different than those expressed in these forward-looking
statements include: the timing of, or ability to obtain, necessary regulatory
and governmental approvals on acceptable terms; the timing and completion of the
financing of NBC Universal on contemplated terms before the closing of the
proposed joint venture; the receipt of an investment grade rating from the
rating agencies of the proposed joint venture between GE and Comcast; adverse
developments in the business and operations of NBC Universal, including
potential disruption that may make it more difficult to maintain business and
operational relationships; and the successful combination, operation and overall
performance of the joint venture post closing. For GE, an additional uncertainty
includes its ability to redeploy its capital into high-growth technology
businesses. For Comcast and NBC Universal, additional uncertainties include the
ability to integrate the programming assets of Comcast and NBC Universal in the
new joint venture; the ability of the new joint venture to create popular
programming, to develop new digital products and services, and to succeed in the
highly competitive media industry; the ability of the new joint venture to
generate attractive financial returns and strong cash flows; and, the effect of
any conditions that regulators may impose in permitting the transaction to
proceed. These uncertainties may cause actual future results to be materially
different than those expressed in these forward-looking statements. None of GE,
Comcast nor NBC Universal undertake to update these forward-looking
statements.
Media
Contacts:
Comcast:
Jennifer Khoury, 215-286-7408, Jennifer_Khoury@comcast.com
John Demming, 215-286-8011, John_Demming@comcast.com
GE:
Anne Eisele,
203-522-9045, anne.eisele@ge.com
NBCU:
Allison Gollust,
212-664-3220, Allison.gollust@nbc.com