Comcast to buy full ownership in NBCU
US cable operator Comcast is acquiring the remaining stake in television and film company NBCUniversal from conglomerate General Electric (GE).
Comcast said it will buy the 49 percent stake in the joint venture with GE for $16.7bn (£10.7bn, €12.4bn). It will also acquire the NBCU floors in the famous 30 Rockefeller Center in New York and CNBC's headquarters in New Jersey for $1.4bn.
As the consideration for the NBCU stake, GE will receive $12bn in cash, $4bn in Comcast guaranteed debt, and $0.7bn of preferred stock.
In 2009, Comcast bought a 51 percent stake in NBCU, which owns the Universal Studios theme parks, television networks like MSNBC and E! and film studios like Universal Pictures, reducing GE's stake in NBCU from 80 percent to 49 percent.
"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," Brian Roberts, chairman and CEO of Comcast, said in a statement.
Comcast will use a combination of cash on hand, senior unsecured notes, bank credit facilities and preferred stock to fund the transaction.
Comcast also reported a 6 percent year-on-year increase in fourth-quarter revenue to $15.9bn. It posted net income of $1.8bn, compared to $1.59bn in the fourth quarter of 2011.
Comcast added that it would increase its dividend by 20 percent and buy back $2bn in stock in 2013.
In line with its plan to exit the entertainment business, GE was looking to sell its remaining stake in NBCU by mid-2014. It expects a pre-tax gain of about $1bn from the sale of its remaining NBCU interest.
"This transaction allows us to significantly increase the cash we plan to return to shareholders in 2013, to approximately $18bn, and to continue to invest in our industrial business," GE chairman and CEO Jeff Immelt, said.
"By adding significant new capital to our balanced capital allocation plan, we can accelerate our share buyback plans while investing in growth in our core businesses."
GE increased its share repurchase authorisation to $35bn and it plans to accelerate its share repurchase programme to about $10bn in 2013.
The closing of the deal, which is subject to customary closing conditions, is expected before the end of the first quarter of 2013.
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