A deal had been expected after news of advanced talks broke earlier this week.
Family-focused DreamWorks will become part of Comcast’s entertainment arm, NBCU, following the agreement, which will significantly bolster Comcast in its bid to rival The Walt Disney Company in the family entertainment space.
Specifically, DreamWorks will sit within the Universal Filmed Entertainment Group, which includes Universal Pictures, Fandango, and NBCUniversal Brand Development.
The deal sees DreamWorks shareholders receive US$41 a share, much higher than the US$34-US$35 range widely referenced this week. This represents recent rapid value growth at the studio, which is behind Shrek, Kung Fu Panda, Madagascar and How to Train Your Dragon among other franchises and owns the AwesomenessTV multichannel network.
The deal is expected to close by the end of the year subject to customary closing conditions and US antitrust clearance.
Once completed, DreamWorks Animation CEO and co-founder Jeffrey Katzenberg (left) will become chairman of DreamWorks New Media, which will house AwesomenessTV and tech arm NOVA. He will also become a consultant to content group NBCU, which houses the NBC broadcast channel and its cable network cousins.
“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; a home that will embrace the legacy of our storytelling and grow our businesses to their fullest potential,” said Katzenberg.
“This agreement not only delivers significant value for our shareholders, but also supports NBCUniversal’s growing family entertainment business. As for my role, I am incredibly excited to continue exploring the potential of AwesomenessTV, NOVA and other new media opportunities, and can’t wait to get started.”
NBCU described DreamWorks’ TV arm as “a thriving operation that is a significant supplier of family programming, with hundreds of hours of original, animated content”.
The TV arm includes shows such as All Hail King Julien (pictured), Penguins of Madagascar and Kung Fu Panda: Legends of Awesomeness, and DreamWorks Classic, which is a library of classic characters such as Where’s Waldo, and Rudolph the Red-Nosed Reindeer it adopted upon buying Classic Media in August 2012.
Other assets in the acquisition include a 45% stake in Oriental DreamWorks, which is a China-based animation studio.
“DreamWorks Animation is a great addition to NBCUniversal,” said Steve Burke, CEO of NBCUniversal. “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.”
The deal is the largest in the entertainment content business so far in 2016.