Comcast to split into two companies in major media shake-up

Comcast Corporation is set to break itself into two publicly traded companies, separating its media empire from its connectivity business as it seeks to sharpen its focus in an industry being reshaped by streaming and large-scale mergers.The company said it will spin off NBCUniversal and Sky into a separate listed entity through a tax-free transaction. Once the separation is completed, existing Comcast shareholders will own shares in both Comcast and the new NBCUniversal company.Following the split, NBCUniversal will house the company's media and entertainment assets, including Universal film and television studios, its theme parks business, the NBC and Telemundo television networks, Peacock, Bravo and European media company Sky.The remaining Comcast business will centre on its cable, wireless and business services operations.According to Comcast, the restructuring is designed to create two focused industry leaders with strong financial profiles, significant scale and distinct strategic opportunities.Leadership reshuffle announcedAlongside the restructuring, Comcast also unveiled changes to its top management.Mike Cavanagh will take over as Chief Executive Officer of NBCUniversal, while former Comcast Chief Financial Officer Michael Angelakis will become Chief Executive Officer of Comcast.Brian L. Roberts will continue to play an active leadership role in both companies after the separation."This is a very exciting day for our company. The transaction we are announcing will unlock a more entrepreneurial management approach and open up a multitude of new opportunities for each business," Brian L. Roberts, Chairman and Co-Chief Executive Officer of Comcast Corporation, said.Cavanagh added: "Comcast will continue to build on its leadership in connectivity, while NBCUniversal, together with Sky, will have the scale, brands, content and financial resources to compete as a premier global media and entertainment company."Deal timeline and ownership structureThe transaction is expected to be completed in about a year, subject to approvals from Comcast's board of directors, shareholders and regulators.NBCUniversal will retain the same dual-class share structure as Comcast. The company also plans to keep a stake of up to 19.9% in NBCUniversal for up to one year after the transaction closes, which it intends to monetise over time in a tax-efficient manner.Investors cheer The market responded positively to the proposed split, with Comcast shares surging 20% in pre-market trading following the announcement.The company has, however, faced a difficult year, with its stock falling around 30 per cent over the past 12 months as the media industry grapples with consumers moving away from traditional television bundles towards streaming platforms.Earlier this year, Comcast also completed the spin-off of its portfolio of cable television networks and digital assets, including CNBC and MS Now, into a separate publicly traded company, Versant Media.Media industry undergoes major shake-upComcast's restructuring comes amid sweeping changes across the American media sector, where legacy companies are reorganising their businesses to better compete with streaming services and respond to industry consolidation.One of the biggest recent deals saw the US Justice Department approve the acquisition of Warner Bros Discovery by Paramount-Skydance in a transaction valued at $111 billion, creating one of America's largest media conglomerates under David Ellison, the son of Oracle founder Larry Ellison.Earlier this month, Fox Corporation also announced an agreement to acquire streaming platform Roku for $22 billion, a move aimed at strengthening its presence on connected television screens.Against this backdrop, Comcast said separating its connectivity and media businesses will allow each company to pursue its own strategy while competing more effectively in an increasingly competitive media landscape.Get the latest business news and top stories. Download the TOI App.Ready to Make a Smarter Property Decision? Build Your Legacy with TOI Homes.