Comcast is to formally separate its media business encompassing NBCUniversal and Sky from its broadband and wireless biz into two public companies.
Following the example of the likes of Warner Bros. Discovery, the tax-free spin-off should complete in about a year.
The NBCUniversal business will house Sky and be run by Comcast Co-CEO Mike Cavanagh. Comcast’s former Chief Financial Officer Michael Angelakis will become the CEO of Comcast, following completion of the separation, and in the interim he will join as a Strategic Advisor.
Comcast said Cavanagh’s co-CEO Brian L. Roberts will continue to be actively involved in the leadership of Comcast and NBCUniversal, working in partnership with the CEOs of both companies.
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NBCUniversal will consist of Sky, Universal film and TV studios, NBC, Telemundo networks, streamer Peacock and Bravo.
The separate Comcast biz will be focused on delivering customer experiences “backed by the nation’s largest converged network, reaching more than 65 million homes and businesses, its intelligent fiber network architecture and global technology platforms.”
Comcast expects to retain a stake of up to 19.9% ownership position in NBCUniversal and Sky for up to one year after the completion of the spin. The move comes with Sky, which Comcast bought for $40B (£30B) in 2018, poised to buy UK commercial broadcaster ITV for £1.6B. Sky has been leading on that one and deal terms have been agreed per a recent Reuters report.
Comcast shareholders will own shares in both Comcast and NBCUniversal, which Comcast said will create “two focused industry leaders, each with significant scale, strong financial profiles and distinct strategic opportunities.”
The move comes after Comcast shelled many of its cable and news networks such as CNBC, the newly-renamed MS NOW, USA Network, Golf Channel, Oxygen, E! and SYFY with the creation of Versant Media.
Roberts, who has overseen Comcast since 2002 and recently became Co-CEO, said: “This is a very exciting day for our company. The transaction we are announcing will unlock a more entrepreneurial management approach and open up a multitude of new opportunities for each business. I very much look forward to helping guide our collective growth for this next chapter.”
He praised Cavanagh for being “one of the finest executives I’ve ever worked with and a trusted partner” and called Angelakis “our widely admired former CFO.”
Cavanagh added: “Both companies begin this next chapter from positions of strength. Comcast will continue to build on its leadership in connectivity, while NBCUniversal, together with Sky, will have the scale, brands, content and financial resources to compete as a premier global media and entertainment company. Each organization will continue to be led by a management team with deep industry experience that will benefit from focused strategic priorities and the ability to pursue opportunities most relevant to their businesses. I’m personally thrilled to continue leading NBCUniversal into the future. With our iconic brands and theme parks, leading franchises and incredible creative talent, we are well-positioned for long-term value creation.”
More detail will be revealed in an investor call in less than two hours.
Goldman Sachs & Co. LLC and PJT Partners are serving as financial advisors to Comcast, and Davis Polk & Wardwell LLP is serving as legal counsel on the deal.
