Comcast Will Buy 51% Stake in Universal Studios Japan for $1.5 Billion

  • Company to pay $1.5 billion for 51% of Universal Studios Japan
  • Comcast, NBCUniversal to become more global: CEO Brian Roberts

Comcast Corp. is making its biggest overseas investment, as the largest U.S. cable operator seeks international growth after being stymied in its bid to acquire the second-largest operator Time Warner Cable Inc.

Comcast’s NBCUniversal unit will pay $1.5 billion for a 51 percent stake in USJ Co., the operating company of the Universal Studios Japan theme park in Osaka, Comcast said in a statement. Current shareholders Goldman Sachs Group Inc., MBK Partners Ltd. and USJ Chief Executive Officer Glenn Gumpel will retain minority stakes.

“We see Comcast and NBCUniversal becoming more of a global company,” Brian Roberts, Comcast chief executive officer, told reporters in Osaka on Monday. “This is the beginning of us making more global investments.” He said the USJ deal was Comcast’s biggest yet overseas.

Philadelphia-based Comcast, which in April dropped its $45.2 billion deal to buy Time Warner Cable amid opposition from antitrust regulators, has been seeking growth in other areas including digital media. Its NBCUniversal unit, which owns Universal Studios Hollywood and Universal Orlando Resort, has license and operating agreements with Universal Studios Japan, according to its website.

Overseas Deals

Comcast’s largest outbound investment before USJ was in 2008, when its NBC Peacock Fund led a consortium to buy German online games-maker Bigpoint GmbH for 70 million euros ($78 million), according to data compiled by Bloomberg. That consortium in 2011 sold a majority stake in Bigpoint for $350 million.

The transaction reflects an enterprise value of 750 billion yen ($6.2 billion) for USJ, with 400 billion yen of that being debt, said Ankur Sahu, Goldman Sachs managing director, at the Osaka briefing. USJ listed in 2007, before being taken private by Goldman two years later as visitors slumped. The company had said it planned to seek a re-listing this year.

There are no plans for a public listing for USJ in the “near future”, although new board members of the company could revisit the plan, Roberts said. The USJ deal is expected to close in three to four weeks, and Gumpel will step down as CEO, to be replaced by Jean-Louis Bonnier, according to Comcast.

Harry Potter

Sales and visitor numbers at the 14-year-old Japanese theme park had hit a record high following a revamp, with a $400 million Harry Potter attraction which opened July last year helping the number of foreign visitors to double to about a million, according to USJ.

“The new Harry Potter attraction had an impact and brought a lot of customers,” said Katsunori Dobayashi, an analyst at Iwaicosmo Securities Co. In addition to visitors from overseas, the theme park was also able to draw more Japanese, including repeated local customers, with concepts unique to the country such as an “Attack on Titan” ride, Dobayashi said.

USJ had sales of 138.5 billion yen in the fiscal year ended March 2015, up 44 percent from a year earlier, while operating profit rose 61 percent to 39 billion yen, both all-time highs, spokesman Johta Takahashi said earlier Monday.

Record Visits

The Universal Studios Japan theme park, which opened in 2001 as a joint venture between Osaka city and a group of private companies, also received a record 12.7 million visitors in the fiscal year through March 2015, up from 10.5 million, according to Takahashi.

Comcast had gained the Universal film and U.S. theme park businesses after it agreed in 2013 to pay General Electric Co. $16.7 billion for full ownership of NBCUniversal, which also gave Comcast control of the NBC broadcast network, as well as cable channels MSNBC and Bravo.

NBCUniversal in August agreed to make a $200 million investment in the news website BuzzFeed and a similar amount in Vox Media, the online publisher of The Verge, Eater and Re/code, in an effort to capture the growth in digital advertising and reach younger consumers.

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