Katzenberg Agrees to Sell Dreamworks Animation
Dreamworks Animation (NASDAQ:DWA) CEO Jeffrey Katzenberg has found a buyer for his film studio.
The Glendale, California animation company has reached an agreement with Comcast (NASDAQ:CMCSA) to be sold for than $3.8-B, sources confirmed late Thursday evening.
The acquisition would fold DWA into an entertainment conglomerate that controls Key properties such as NBC, Telemundo, the USA Network and Universal Studios, a strong fit for DWA.
The move provides Mr. Katzenberg with a strong buyer after years of industry discussions.
The $3.8-B offer is a premium for shareholders who have invested in a company presently worth $2.3-B.
The word is that Mr. Katzenberg will not maintain a role in running the studio he helped to form in Y 1997 under parent company DreamWorks SKG, which he created 5 years earlier along with Steven Spielberg and David Geffen. The animation studio was spun off as a separate company in Y 2004, with Mr. Katzenberg at the helm.
The studio currently has a distribution deal with 20th Century Fox (NASDAQ:FOX) that runs out at the end of Y 2017.
Buying DWA would give Universal 2 of Hollywood’s leading animation studios, since it already owns Chris Meledandri’s Illumination Entertainment. With DWA and Illumination in-house, Universal could challenge Disney’s (NYSE:DIS) animation powerhouse combination of Pixar and Disney Animation Studios.
DWA has been transforming its film operations after a series of box office disappointments, including Turbo and Penguins of Madagascar, weighed on its Quarterly results. DWA responded by cutting 500 jobs last year, closed an animation studio in Redwood City, Calififornia.
Last year, the company reported a $53.9-M loss that was a big improvement from the $308-M deficit it marked in Y 2014.
|HeffX-LTN Analysis for DWA:||Overall||Short||Intermediate||Long|
|Bullish (0.25)||Neutral (0.19)||Bullish (0.38)||Neutral (0.19)|
Have a terrific weekend.
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