Jeffrey Katzenberg’s DreamWorks Bought by Comcast for $3.8B
Image by Getty Images
Comcast Corp, the owner of NBCUniversal, said on Thursday it would buy Hollywood movie studio DreamWorks Animation SKG Inc for $3.8 billion to boost its family-friendly offerings and help it take on No. 1 player Walt Disney.
Comcast’s acquisition of DreamWorks Animation will add to Universal’s film library major childrens’ franchises such as “Shrek” and “Kung Fu Panda,” which it could tap for its theme parks and consumer products businesses.
Comcast’s Universal Pictures has shown signs of success with family films like “Despicable Me” and “Minions,” but this deal will ramp up its portfolio and fledgling animation business Illumination Entertainment.
DreamWorks’ burgeoning TV business will also be a boon to Universal, Macquarie analyst Amy Yong said in a research note. DreamWorks signed a deal earlier this year with Netflix to distribute series such as “The Adventures of Puss in Boots” and develop original series on the streaming subscription service.
The $41-per-share cash offer represents a premium of about 27 percent to DreamWorks’ Wednesday close.
DreamWorks shares, which have gained nearly 50 percent in the last six months, soared 24 percent to $39.95 per share on Thursday.
DreamWorks Chief Executive Jeffrey Katzenberg will become chairman of DreamWorks New Media, which will include the company’s ownership interests in Awesomeness TV and NOVA. He will also serve as a consultant to NBCUniversal.
DreamWorks Animation was spun off from DreamWorks Studios in 2004. The studio was founded in 1994 by Katzenberg, Steven Spielberg and David Geffen.
The animation studio had come close to being sold before but never sealed the deal.
In 2014, DreamWorks Animation held talks about a possible sale to Japanese communications and media company Softbank Corp , a source with knowledge of the matter told Reuters at the time.
Later that year, toymaker Hasbro Inc held preliminary talks to buy DreamWorks Animation, according to another source at the time. The talks formally ended a few days later after Hasbro’s board voted to walk away.
Stifel analyst Benjamin Mogil said he did not think another bidder would come in and top Comcast’s offer “given the valuation and the operational role for DreamWorks Animation CEO Jeffrey Katzenberg in this deal.”
DreamWorks Animation was advised by boutique investment bank Centerview Partners Holdings LLC, which Reuters first reported on Wednesday, and legal adviser Cravath, Swaine & Moore LLP. Comcast’s legal adviser was Davis Polk & Wardwell LLP and the company did not list a financial adviser.
I hope you appreciated this article. Before you go, I’d like to ask you to please support the Forward’s award-winning journalism this Passover.
In this age of misinformation, our work is needed like never before. We report on the news that matters most to American Jews, driven by truth, not ideology.
At a time when newsrooms are closing or cutting back, the Forward has removed its paywall. That means for the first time in our 126-year history, Forward journalism is free to everyone, everywhere. With an ongoing war, rising antisemitism, and a flood of disinformation that may affect the upcoming election, we believe that free and open access to Jewish journalism is imperative.
Readers like you make it all possible. Right now, we’re in the middle of our Passover Pledge Drive and we still need 300 people to step up and make a gift to sustain our trustworthy, independent journalism.
Make a gift of any size and become a Forward member today. You’ll support our mission to tell the American Jewish story fully and fairly.
— Rachel Fishman Feddersen, Publisher and CEO
Join our mission to tell the Jewish story fully and fairly.
Only 300 more gifts needed by April 30
