Comcast to Split Into Two Companies via Spinoff of NBCUniversal, Including Sky

In a major move that reshapes the media landscape, Comcast plans to separate into two independent, publicly traded companies through a tax-free spinoff of NBCUniversal and Sky, the company said on Monday.

“For more than sixty years, our company has grown by embracing change and investing for the future. Today is another one of those moments,” Comcast co-CEOs Brian Roberts and Mike Cavanagh wrote in a note to staff Monday.

Roberts, who controls the company, will continue to be “actively involved” in the leadership of Comcast and NBCUniversal, working in partnership with the CEOs of both companies, the company said. Current co-CEO Mike Cavanagh will serve as the CEO of NBCUniversal, while Comcast’s former CFO Michael Angelakis will become the CEO of Comcast, following the completion of the separation and in the interim will join as a strategic adviser.

“Upon completion of the transaction, Comcast shareholders will own shares in both Comcast and NBCUniversal, creating two focused industry leaders, each with significant scale, strong financial profiles and distinct strategic opportunities,” it said.

“The proposed separation reflects Comcast’s track record of positioning its businesses to compete and win in rapidly changing markets,” it continued. “As technological innovation, consumer behavior and competitive dynamics continue to reshape both media and communications, Comcast’s board and management team believe each company will be better positioned to pursue its own strategic priorities, invest for growth and create long-term shareholder value as independent entities.”

NBCUniversal is anchored by its growing theme parks division, the Universal film and television studios, the NBC and Telemundo networks, streaming service Peacock and the Bravo cable network. In addition, NBCUniversal’s portfolio will include Sky, its European media business.

The conglomerate previously separated Versant Media, the home of most of its cable networks, in another move to create more focused businesses.

Similar to the Versant spin, the split of Comcast is likely a precursor for more dealmaking: A stand-alone connectivity company may be better positioned to do deals (either as a buyer or a seller) with other telecom companies, right as the cable business is under pressure from fixed wireless and now satellite internet firms like Starlink.

And a stand-alone NBCUniversal could pursue deals with other media companies (once again, as a buyer or seller) to scale up and compete. Warner Bros. Discovery, after all, saw interest in its business soar after it announced a plan to split its cable TV and studios business, sparking a bidding war from NBC, Netflix and the ultimately victorious Paramount Skydance.

“As an independent company, NBCUniversal will have even greater flexibility to invest behind its strongest opportunities, expand partnerships and compete with greater agility in a rapidly changing media landscape. We’re equally excited about the future of Comcast,” Roberts said on the investor call.

Similar to the WBD deal structure, Comcast says that it will retain a 19.9 percent stake in NBCUniversal, with plans to monetize it after the split in order to help it deleverage. That suggests that the company believes there will be interest in NBCU.

That said, on the call, Cavanagh poured some cold water on the idea that a stand-alone NBCU would sell itself outright, saying it is “definitely not our plan.”

“We have the ambition that’s big to pursue opportunities that keep us ahead of evolving consumer behavior and audience demands, and we have the freedom now to explore adjacent businesses where we have the right to play, and that’s thanks to the stability of our company and management team, and, like I said, a strong balance sheet, and we will continue to build these businesses from what we believe is a position of strength,” he added.

As for why the spinoff is happening now, executives pointed to a changed mindset about how to operate media and telecom businesses in the current landscape.

“Where we previously believed that scale and the diversification benefits warranted operating these businesses as one company, we’ve now simply changed our mind about that. We’ve now concluded that future success for each of our businesses will depend on focus, speed and strategic flexibility that this separation will unlock,” Cavanagh said.

Executives added that the timing was not related to results within the quarter, which will be reported in three weeks and are expected to be within expectations.

Said Roberts, chairman and co-CEO of Comcast: “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. I very much look forward to helping guide our collective growth for this next chapter.”

He added: “Mike Cavanagh will lead the new NBCUniversal media and entertainment company as CEO. Mike is one of the finest executives I’ve ever worked with and a trusted partner. His vision is for a unique, independent, focused company that will be home to some of the industry’s most valuable brands and assets across theme parks, film, television, streaming, sports and news. This new company will be well-positioned to pursue the significant opportunities that lie ahead, to partner across the media and entertainment ecosystem, and will be poised to grow.”

Said Cavanagh: “Both companies begin this next chapter from positions of strength. 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. Each organization will continue to be led by a management team with deep industry experience that will benefit from focused strategic priorities and the ability to pursue opportunities most relevant to their businesses. I’m personally thrilled to continue leading NBCUniversal into the future. With our iconic brands and theme parks, leading franchises and incredible creative talent, we are well-positioned for long-term value creation.”

— Caitlin Huston contributed to this report.