Wednesday, March 4, 2015

SOLD: Disney, Hearst pay Comcast $3B for A&E stake

Leaves NBCU more reliant on sports

SOLD: Disney, Hearst pay Comcast $3B for A&E stake

It's official: Comcast told the SEC this morning that Disney/ABC and Hearst have agreed to pay $3.025 billion for the nearly 16% of A&E that Comcast's NBC owned, making the buyers each 50% co-owners. Filing here. Bob Fernandez's pre-deal story in the Inqurier here.

Why sell now? "Unlike most of NBC Universal, A&E is performing very well" with its History Channel, Lifetime and A&E networks, writes bond analyst Dave Novosel of Gimme Credit LLC.  

The sale leaves NBC Universal more reliant on sports, including the upcoming London Summer Olympics. "Management likes sports because virtually all viewers want to see the action live, thus avoiding the taping of shows and the subsequent ad skipping," Novotel notes. "It is highly unlikely that NBC would actually make money on the Olympics," at least on direct transmission.

To boost sales the network is likely to pursue Major League Baseball and other sports programming, which is getting more expensive, squeezing margins and making Novosel "lean towards a sell recommendation" on Comcast bonds, he concluded.

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Joseph N. DiStefano
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PhillyDeals posts raw drafts and updates of Joseph N. DiStefano's columns and stories about Philly-area finance, investment, commercial real estate, tech, hiring and public spending, which he's been writing since 1989, mostly for the Philadelphia Inquirer.

DiStefano studied economics, history and a little engineering at Penn, taught writing at St. Joe's, and has written the book Comcasted, more than a thousand columns, and thousands of articles, and raised six children with his wife, who is a saint.

Reach Joseph N. at or 215 854 5194.

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