Why NBCUniversal Might Sell Stake in A+E Networks

Comcast says stake would be divided between Hearst and Disney

Comcast revealed last week that its NBCUniversal group, which owns broadcasters including NBC and Telemundo and cable networks from USA to Bravo, would sell off its 15.8 percent stake in A+E Networks, a cable network company that brings in some $3.1 billion annually from holdings including History and A&E.

Industry sources said that the eventual sale, revealed in an SEC filing, would bring NBCU some ready cash, making it a good asset to liquidate. NBCU's stake in the property could come to $2 billion, money that could be used to offset NBCU's substantial debt.

NBCU was required to contribute some $9.1 billion toward Comcast's purchase of a controlling interest in NBCU. A controlling interest is all Comcast has, though. For Comcast to wholly own NBCU, NBCU would first have to pay off its debts, which include some $5.1 billion in debt sold to raise money for the sale to Comcast.

On March 26, NBCU exercised an option in its contract with A+E that requires A+E Networks to redeem a substantial portion of NBCU’s equity interest in A+E. The transaction is scheduled to close during the second half of 2012 when the parties involved will have negotiated the value of the stake. Hearst and Disney are the other two partners in the split, and both have 42.1 percent stakes in the enterprise, giving either the ability to overrule NBCU when it comes to running the joint venture.