Tag Archives: technology

Comcast Buys DreamWorks, Content Provider To Netflix, Amazon

Comcast ( CMCSA ) on Thursday agreed to buy movie studio DreamWorks Animation ( DWA ) for $3.8 billion in cash, or $41 per share, adding to its NBCU Universal media and entertainment properties. DreamWorks Animation stockholders will receive $41 in cash per share. DreamWorks stock spiked on Wednesday after multiple reports of Comcast’s interest surfaced. The deal will boost Comcast-NBCU’s presence in China. Comcast will also retain control of DreamWorks’ AwesomenessTV, which develops short-form video for millennials, those ages 18 to 34. Verizon Communications and Hearst in early April acquired a 24.5% stake in AwesomenessTV for $159 million. DreamWorks CEO and co-founder Jeffrey Katzenberg will become chairman of DreamWorks New Media, which will include Awesomeness TV and Nova, a 3D visualization technology startup. The acquisition is expected to close by year-end, said Comcast. Comcast stock was up a fraction in the stock market today , near 61.50. DreamWorks stock was up 24%, near 40. “The biggest reason (for Comcast) to buy DreanWorks is to secure content supply,” said Evan Wingren, an analyst at Pacific Crest Securities, in a research report. “Comcast has a dominant position in live video distribution, but has fallen behind Netflix ( NFLX ) and Amazon ( AMZN ) in on-demand. By securing a pipeline of children’s television content and library films, it could bolsters its on-demand catalog in an effort to compete with Netflix.” DreamWorks has developed TV shows for Netflix and Amazon.com’s Prime streaming service. Comcast acquired NBCU from General Electric ( GE ) in 2011. Aside from Universal Films, Comcast owns Focus Features and Illumination Entertainment, the latter of which developed the “Minions” movies. DreamWorks’ most popular movie franchises include “Shrek,” “Madagascar,” “Kung Fu Panda ”  and  “ How to Train Your Dragon.” There’s optimism, analysts say, for the upcoming “Despicable Me 3” and “The Secret Life of Pets.” Theme parks have become a key part of Comcast’s overall growth. In a research note, Bryan Kraft, an analyst at Deutsche Bank, said the Dreamworks acquisition “expands NBCU into animation in a more meaningful way, increases the intellectual property pipeline for  theme parks and consumer products, and increases Universal Studios’ exposure to tent pole global film franchises. It also diversifies Comcast away from a more mature U.S. media/television industry.” Comcast-NBCU is building a $3.3 billion theme park in Beijing with local investors. It’s slated to open in 2019. The Oriental DreamWorks movie studio, meanwhile, is building a headquarters and entertainment center in Shanghai with local partners.

AT&T Push Into Mexico Vs. America Movil Looking Good So Far

AT&T ’s ( T )push into Mexico’s wireless phone market seems to be gaining traction vs. incumbent America Movil ( AMX ), analysts say. AT&T said it added 529,000 wireless subscribers in Mexico in Q1, with one-fourth the higher-spending postpaid customers who are billed monthly.  Late Tuesday, AT&T reported that its Q1 operating loss was $251 million, amid network investments and subscriber acquisition costs. “This is now the second consecutive quarter with 500,000 plus net adds, giving us confidence in the execution of the strategy abroad,” said Amy Yong, a Macquarie analyst, in a report. “Profitability is also expected to improve by the second half of 2016. We expect free cash flow contribution could come as early as 2017.” AT&T and America Movil both acquired more radio spectrum in a radio spectrum auction held by the Mexican government last quarter. In the U.S., AT&T said it lost postpaid phone lines for the sixth consecutive quarter amid stiff competition from  Verizon Communications ( VZ ), T-Mobile US ( TMUS ) and Sprint ( S ). AT&T acquired Mexico’s No. 3 wireless firm, Iusacell, as well as Nextel Mexico out of bankruptcy, for a combined $4.4 billion. It’s spending over $3 billion to upgrade networks to 4G technology. With the Q1 gain, AT&T has  9.2 million total wireless subscribers in Mexico. AT&T’s subscriber gains could accelerate after it finishes the 4G network upgrade, says Colby Synesael, an analyst at Cowen & Co. America Movil, which sells wireless services under the Telcel brand in Mexico, holds nearly 68% of the market, with Telefonica ( TEF ) at 19% and AT&T at 13%. Controlled by Carlos Slim, America Movil is one of Latin America’s two largest wireless services providers, along with Telefonica.

Abbott Labs Will Buy St. Jude Medical For $25 Billion

Abbott Laboratories ( ABT ) agreed to buy St. Jude Medical ( STJ ) in a deal that values the maker of heart devices at $25 billion, making its biggest ever acquisition as the industry consolidates to gain bargaining power with hospitals. St. Jude Medical shareholders will receive $46.75 in cash and 0.8708 share of Abbott common stock, representing a total of approximately $85 per share, according to a statement Thursday. Medical devices makers are merging to get access to new technology as hospitals push for lower prices. St. Jude last year acquired Thoratec for $3.4 billion, adding left ventricular pump devices that take over for a failing heart. The combined Abbott-St. Jude medical company will have a pipeline of new medical device products across cardiovascular, diabetes, vision and neuromodulation patient care, according to the statement. Abbott said in the statement it has financing for both St. Jude Medical and for its planned acquisition of Alere ( ALR ) for $5.8 billion, sending Alere shares higher in early trading on the stock market today . Abbott Chief Executive Officer Miles White declined to reiterate his commitment to the Alere deal last week on the company’s earnings call. Alere hasn’t yet filed its 10-K report with U.S. regulators and has been subpoenaed by the Justice Department. St. Jude Medical closed Wednesday at $61.95, giving the company a market value of about $17.6 billion. The stock jumped to $78.66 before the markets opened in New York. Abbott dropped 5 percent to $41.65 in early trading, while Alere rose 3.5 percent to $44.35. The acquisition will further reshape Abbott, which split off its brand name pharmaceutical business to AbbVie ( ABBV ) in 2013. Since then, the company has shied away from major acquisitions and pursued many smaller deals, even as the CEO talked often about his desire for larger purchases. Abbott has cash on hand, obtained by selling its generic drug business for medicines marketed in Europe and the developed world to Mylan ( MYL ).