Comcast to acquire Dream Works Animation for $3.8b

bengaluru — Comcast Corp, the owner of NBC Universal, said on Thursday it would buy Hollywood movie studio Dream Works Animation SKG Inc for $3.8 billion to boost its familyfriendly offerings and help it take on No. 1 player Walt Disney.

Comcast’s acquisition of Dream Works 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.

Dream Works’ burgeoning TV business will also be a boon to Universal, Macquarie analyst Amy Yong said in a research note. Dream Works 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 per cent to Dream Works’ Wednesday close. Dream Works shares, which have gained nearly 50 per cent in the last six months, soared 24 per cent to $39.95 per share on Thursday.

Dream Works chief executive Jeffrey Katzenberg will become chairman of Dream Works New Media, which will include the company’s ownership interests in Awesomeness TV and NOVA. He will also serve as a consultant to NBC Universal. —