In an effort to increase its competition with family entertainment juggernaut Disney, Comcast announced this morning that it will spend $3.8 billion to acquire DreamWorks Animation, home to popular kids’ franchises like “Shrek,” “Madagascar,” “How to Train Your Dragon,” “Kung Fu Panda,” and others. The deal will close by year-end, subject to its receipt of antitrust approvals in the U.S. and abroad, the company said. Stockholders will receive $41 in cash for each share on DreamWorks Animation’s common stock.
The DreamWorks Animation studio will become a part of the Universal Filmed Entertainment Group, which today includes Universal Pictures, Fandango, and NBCUniversal Brand Development. Universal Pictures is home to the “Despicable Me” and “Minions” franchise, but DreamWorks will bring a whole new cast of characters to enhance Comcast’s theme parks, TV programming, and kids’ toys and products.
As a part of the deal, DreamWorks Animation CEO and co-founder Jeffrey Katzenberg will become Chairman of DreamWorks New Media. This division will consist of the company’s ownership stakes in Awesomeness TV and NOVA. DreamWorks had acquired the teen-focused YouTube network Awesomeness TV in 2013 for $33 million, and continues to be the majority shareholder with a 51 percent stake, though TechCrunch parent company Verizon recently took a 24.5 stake in the business.
Katzenberg will continue to consult to Comcast’s NBCUniversal division, following the acquisition, Comcast said.
Previous reports suggested Katzenberg would exit DreamWorks, but that doesn’t seem to be the case at this time.
“Having spent the past two decades working together with our team to build DreamWorks Animation into one of the world’s most beloved brands, I am proud to say that NBCUniversal is the perfect home for our company,” said Katzenberg.
The studio had been looking for a buyer for some time, The WSJ reported, adding that it was one of the last in Hollywood independent of a larger conglomerate. The company had talked to Hasbro and Softbank in years past, but no deal emerged.
DreamWorks Animation is a great addition to NBCUniversal,” said Steve Burke, CEO of NBCUniversal, in a release. “Jeffrey Katzenberg and the DreamWorks organization have created a dynamic film brand and a deep library of intellectual property. DreamWorks will help us grow our film, television, theme parks and consumer products businesses for years to come. We have enjoyed extraordinary success over the last six years in animation with the emergence of Illumination Entertainment and its brilliant team at Illumination Mac Guff studio. The prospects for our future together are tremendous. We are fortunate to have Illumination founder Chris Meledandri to help guide the growth of the DreamWorks Animation business in the future.”
In addition to the well-known kids’ movie franchises, DreamWorks Animation also brings to NBCUniversal a TV operation which supplies hundreds of hours of family programming to both linear and subscription video on-demand platforms across 130 countries. From Netflix, DreamWorks Animation brought in $300 million in 2015, up from $100 million the year before, to give you an idea. As Variety noted, that’s a notable figure – $300 million is 50 percent higher than the combined revenues from “Home” and “The Penguins of Madagascar” in 2015.
It also owns a library of classics, like “Where’s Waldo?” and “Rudolph the Red-Nosed Reindeer,” and a consumer products business.