Comcast Corporation and General Electric finally unveiled the $37.5 billion merger that will see the end of GE’s 23-year ownership of NBC. This also marks the end of the industrial conglomerate’s venture into the media business. As part of the deal, Comcast gets the 51% controlling stake while GE holds onto the remaining 49%. GE also reserves the right to sell back the remaining shares over a seven-year period commencing three and a half years after the deal is completed. Comcast’s controlling stake is reported to cost $6.5 billion in cash along with the contribution of most of its cable channels and digital assets to the new NBC U.
The Roberts family who were the founders of the Cable pioneer Comcast controls it tightly. They have long had aspirations to expand the company’s scope into Hollywood. The company went from being a medium-sized cable operator to No. 1 nearly overnight, when it made the $72 billion purchase of AT&T’s cable systems in 2002.
Comcast has pursued the NBC U deal over the past few years without much success. The defining moment came recently when GE’s former NBC U partner, French Telco Vivendi decided to sell its 20% percent stake paving the way for Comcast to step in. “With this transaction, I believe our company is strategically complete,” said Comcast chairman-CEO Brian Roberts.
A five-member board of directors consisting of Roberts, Comcast COO Steve Burke and Comcast chief financial officer Michael Angelakis, GE chairman Jeffrey Immelt and GE chief financial officer Keith Sherin will oversee the NBC U.