Once deal closes, DreamWorks will become part of the Universal Filmed Entertainment Group
By Barbara Ortutay, Technology Writer
NEW YORK (AP) --Comcast is buying DreamWorks Animation, the film company behind the "Shrek," ''Madagascar" and "Kung Fu Panda" franchises, for approximately $3.55 billion, strengthening its presence in the important and growing business of children's entertainment.
DreamWorks stockholders will receive $41 for each share they own. That's a 24 percent premium to the company's Wednesday closing price of $32.20. The companies put the deal's value at about $3.8 billion.
DreamWorks will become part of the Universal Filmed Entertainment Group, which includes Universal Pictures. The studio has churned out hit animated movies through its Illumination label, including the "Minions" sequel and it has some Dr. Seuss projects in the works such as "How the Grinch Stole Christmas."
The nation's largest cable company said the deal gives NBCUniversal, a unit of Comcast Corp., a "broader reach to a host of new audiences in the highly competitive kids and family entertainment space, in both TV and film." In addition to the cartoon franchises, DreamWorks also owns what Comcast called a "thriving TV operation" with its AwesomenessTV network of online video creators and a lengthy contract to create shows for Netflix.
The deal solves what Cowen and Co. analyst Doug Creutz "would have been a very difficult succession plan had DWA remained independent, as to a certain extent we think the company had been held together purely through (CEO Jeffrey) Katzenberg's force of will."
The analyst said that while he is "skeptical about the strategic logic" for Comcast in inking the deal, it is an excellent one for DreamWorks.
"Despite some positive recent developments with TV production and the Awesomeness asset, DWA remains a company that has not generated significant earnings since 2010," Creutz wrote. "We think DWA is worth far less than either Marvel or Lucasfilm, for which Disney paid comparable prices when they acquired those companies."
Once the deal closes, DreamWorks co-founder and Katzenberg will become chairman of DreamWorks New Media. He'll also serve as a consultant to NBCUniversal. Creutz called it a "happy exit." Katzenberg owned nearly 10 million shares – meaning he'll receive over $400 million – and controlled 60 percent of the voting shares in the company, which spun off from DreamWorks Pictures as a publicly traded company in 2004. DreamWorks Pictures, backed by Steven Spielberg, produces live action movies like "Bridge of Spies" and is not part of the deal.
Earlier this year, DreamWorks expanded a licensing deal with Netflix Inc. to have the online video service feature more of its series and movies. The expanded licensing agreement announced in January allows Netflix to showcase several new DreamWorks series, including "Trollhunters," a fantasy created by acclaimed movie director Guillermo del Toro. The deal gives Netflix more video likely to appeal to children, an audience segment that has played an important role in its growing its service to 81.5 million subscribers in the first quarter.
The boards of both Comcast and DreamWorks have approved the transaction, which is targeted to close by year's end.
First-Time Feature Directors Make Major Splash At AFI Fest, Generate Oscar Buzz
Two first-time feature directors who are generating Oscar buzz this awards season were front and center this past weekend at AFI Fest in Hollywood. Rachel Morrison, who made history as the first woman nominated for a Best Cinematography Oscar---on the strength of Mudbound in 2018--brought her feature directorial debut, The Fire Inside (Amazon MGM Studios), to the festival on Sunday (10/27), and shared insights into the film during a conversation session immediately following the screening. This came a day after William Goldenberg, an Oscar-winning editor for Argo in 2013, had his initial foray into feature directing, Unstoppable (Amazon MGM Studios), showcased at the AFI proceedings. He too spoke after the screening during a panel discussion. The Fire Inside--which made its world premiere at this yearโs Toronto International Film Festival--tells the story of Claressa โT-Rexโ Shields (portrayed by Ryan Destiny), a Black boxer from Flint, Mich., who trained to become the first woman in U.S. history to win an Olympic Gold Medal in the sport. She achieved this feat--with the help of coach Jason Crutchfield (Brian Tyree Henry)--only to find that her victory at the Summer Games came with relatively little fanfare and no endorsement deals. So much for the hope that the historic accomplishment would be a ticket out of socioeconomic purgatory for Shields and her family. It seemed like yet another setback in a cycle of adversity throughout Shieldsโ life but she persevered, going on to win her second Gold Medal at the next Olympics and becoming a champion for gender equality and equitable pay for women in sports. Shields has served as a source of inspiration for woman athletes worldwide--as well as to the community of... Read More