Comcast is splitting its entertainment and telecoms businesses

With the aim of creating “two specialised industry leaders” and competing within a “rapidly evolving” environment, Comcast has begun the process of splitting into two companies: Comcast itself, specialising in technology and telecommunications, and NBCUniversal, focused on film, television, streaming and theme parks.

As technological innovation, consumer behaviour and competitive dynamics continue to transform both the media and telecommunications sectors, Comcast’s Board of Directors and management team believe that each company will be better positioned to pursue its own strategic priorities, invest in growth and create long-term value for shareholders as independent entities.

Brian L. Roberts will continue to play an active role in the leadership of Comcast and NBCUniversal, working in collaboration with the chief executive officers of both companies. Mike Cavanagh will be the chief executive officer of NBCUniversal, and Comcast’s former chief financial officer, Michael Angelakis, will become the chief executive officer of Comcast once the separation is complete. In the meantime, he will join the company as a strategic adviser.

The new Comcast will serve residential and business customers through its broadband, mobile and entertainment platforms. With one of the fastest-growing mobile businesses in the United States, its business services platform and significant free cash flow generation, Comcast is well positioned for continued long-term growth.

Meanwhile, NBCUniversal will be structured around its growing theme park division; Universal’s film and television studios; the NBC and Telemundo networks; and the Peacock and Bravo platforms. Furthermore, NBCUniversal’s global portfolio will include Sky, a media business in Europe. All these businesses will be driven by a world-class portfolio of intellectual property, an extensive content library and ‘exceptional strength’ in the fields of sport, news and entertainment.

The separation is expected to be completed via a tax-free spin-off in favour of Comcast shareholders in approximately one year’s time, subject to the fulfilment of customary conditions, including final approval by Comcast’s Board of Directors, the receipt of tax rulings, regulatory approvals and the finalisation of financing agreements. NBCUniversal will have the same dual-class share structure as Comcast. Comcast plans to retain a stake of up to 19.9% in NBCUniversal for up to one year following completion of the spin-off, which it intends to monetise in a tax-efficient manner over time.

Comcast intends to establish a strong, investment-grade balance sheet for each business, which will provide both Comcast and NBCUniversal with significant financial flexibility to pursue their respective growth strategies.