By Echo Wang, Dawn Chmielewski and Milana Vinn
June 29 – NBCUniversal is eyeing opportunities in digital gaming and new entertainment franchises as the company weighs options for future growth after its planned spinoff from Comcast, according to three people with direct knowledge of the matter.
Comcast’s cable and connectivity business, meanwhile, is ripe for technological investments that could take advantage of the massive surge in data centers and AI, these people said.
No tie-ups have been discussed, and any potential deal would not happen until a period of time following the split, the people said. These are among a broad range of options the company is exploring.
Comcast declined to comment on any possible deals.
In an interview with Reuters, Comcast CEO Brian Roberts said the company had decided the separation was “the better way to move forward for the opportunities that we see for both of these businesses is to let them run independent of each other with focused dedicated great management teams and strong assets.”
As to the timing, he added: “We just decided once you’re in go mode, you know, we want to go.”
The announcement has ignited chatter of potential M&A activity for both businesses, especially at a time when television and film sales have continued to decline as people cut the cord in favor of streaming, games and social media. Shares in Charter rose as much as 25% on Comcast’s announcement on speculation the two could merge.
Roberts denied any suggestion the planned spinoff was a prelude to further deals.
“Absolutely not,” he said on a Monday call with investors. He added that it’s “the right move to put each company in the strongest position to create value, fully monetize its assets, and aggressively pursue its own or great organic growth strategies.”
Despite that stance, bankers, lawyers and analysts said NBCUniversal assets could become an attractive takeover target, pointing to its film and television studio, theme parks and streaming service Peacock as higher-growth businesses compared with its declining cable channels.
One potential buyer could be Netflix, according to a person familiar with the matter, who said the streaming company could view NBCUniversal’s studio and content library as strategically complementary, though any combination would likely face significant regulatory and structural hurdles.
As part of the spinoff, Comcast will retain a 19.9% stake in NBCUniversal, which the company plans to sell down over time to help avoid taxes.
But to preserve the tax‑free structure, NBCUniversal would need to operate independently for at least a year after the spinoff, during which period it cannot pursue a sale or a merger. At the same time, the entertainment giant could consider an M&A transaction sooner as long as the parties had not previously discussed a potential deal.
Comcast declined to comment on this analysis of the tax implications.
Michael Cavanagh, who will run NBCUniversal following the split, added, “We have the freedom now to explore adjacent businesses where we have the right to play.”
Roberts has had a long interest in gaming. His son, Tucker Roberts, runs Comcast’s gaming division and advised his father on expanding into the Korean e-sports market.
Comcast previously explored acquiring Activision and Electronic Arts, as well as taking an equity stake in Epic Games, maker of Fortnite, according to one person with direct knowledge of the talks. The company also has a partnership with Nintendo for theme park attractions and two animated films, “The Super Mario Bros. Movie” and “The Super Mario Galaxy Movie,” that each grossed more than $1 billion at the global box office.
Among the major game industry companies, Take-Two may have the most valuable trove of intellectual property, including Grand Theft Auto, whose sixth installment has already recorded more than $3 billion in preorders ahead of its November 19 launch.
Microsoft’s Xbox gaming unit — whose most successful titles include Halo, Fallout and The Elder Scrolls — may well be spun off into a separate company.
Electronic Arts, a significant games publisher, is being taken private in a $55 billion deal controlled by Saudi Arabia’s Public Investment Fund, private-equity firm Silver Lake and Jared Kushner’s Affinity Partners. The investors are awaiting approval from the European Commission.
Overall, the planned separation was greeted warmly on Wall Street as Comcast’s stock jumped as much as 20%. The split is expected to give Comcast greater strategic flexibility for its two businesses, signaling the end of a pipes-and-content empire that didn’t make sense to many investors.
“We don’t see a Netflix-for-NBCU deal. And no, we don’t see a Comcast and Charter deal, either,” longtime media analyst Craig Moffett of research firm MoffettNathanson wrote in a note following the announcement.
He added: “Having them under the same roof didn’t make either better, and the combined company has been saddled by a conglomerate discount for 15 years to reflect the suboptimal capital allocation that conglomerates demand.”
(Reporting by Echo Wang, Dawn Chmielewski and Milana Vinn; writing by Edmund Lee; editing by Nick Zieminski)
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