Comcast Corp. (CMCSA:US)’s NBC Universal entertainment business is near an agreement to sell its 15.8 percent stake in A&E Networks for about $3 billion, according to a person with knowledge of the talks.
NBC Universal is negotiating with Walt Disney Co. (DIS:US) and Hearst Corp., the other owners of A&E, the cable-TV company that includes Lifetime and the History Channel, said the person, who sought anonymity because the discussions are private.
A sale at that price would value all of A&E at about $19 billion. Comcast, based in Philadelphia, valued its stake at $2.02 billion as of March 31, according to a quarterly filing.
“It fits in with Comcast’s strategy to sell assets which it does not control operationally,” Marci Ryvicker, an analyst with Wells Fargo Securities, said yesterday in a research note.
Jennifer Khoury, a Comcast spokeswoman, declined to comment.
The existing arrangement was created when New York-based NBC Universal, Disney and Hearst merged the Lifetime and A&E cable channels in 2009. The accord included a provision for NBC to leave the partnership if it chooses and for Disney and Hearst to become 50-50 owners. Comcast exercised its option to sell the stake on March 26.
Comcast, the largest U.S. cable-system, declined 0.3 percent to $31.36 yesterday in New York. The shares have gained 32 percent this year. The company acquired control of NBC Universal in January 2011 from General Electric Co. (GE:US)
Proceeds from the sale of A&E may help Comcast buy the 49 percent stake in NBC that GE still owns, Ryvicker said in the note. GE can put half of its holding to Comcast in June 2014 and the rest in January 2018, she said.
“According to our calculations, we estimate that half of GE’s remaining stake would ‘cost’ Comcast $7 billion to $8 billion in 2014,” Ryvicker wrote.
The price of the A&E stake was reported yesterday by the Wall Street Journal. Bloomberg News reported on May 5 that Comcast was selling a “substantial” amount of A&E.
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