NBC To Acquire Telemundo Communications Group, Inc.

NBC announced that it has reached an agreement for the acquisition of 100% of the equity of Telemundo Communications Group, Inc. Under the agreement, Telemundo’s extensive broadcast and cable properties will be brought into NBC, making NBC the only major broadcast network with a business fully devoted to developing and airing programming specifically created for the Spanish-speaking market.

NBC is a division of General Electric. Telemundo is currently privately held by Sony Pictures Entertainment, Liberty Media and a consortium of financial investors.

The transaction values the equity at $1.98 billion, payable half in cash and half in GE stock. NBC will also assume debt at closing estimated to be $700 million.

“We couldn’t be more excited about the addition of Telemundo to the NBC family, which already includes a significant cable network presence along with the nation’s leading broadcast network,” said Bob Wright, Vice-Chairman of General Electric and Chairman and CEO of NBC. “The vibrant Hispanic market accounts for a significant and growing share of the nation’s economy and we are eager to draw on Telemundo’s expertise to better serve this important audience. This transaction positions NBC for continued industry leadership, and is a clear sign of our commitment to both over-the-air broadcasting and cable programming networks.”

“This acquisition, the largest in NBC’s history, represents NBC’s strong commitment to growing our network business,” said Andrew Lack, President and COO of NBC. “Led by Jim McNamara, Telemundo has a strong team of people with programming vision and expertise. We are thrilled to welcome the Telemundo team to NBC and are looking forward to collaborating with them to strengthen our reach within the Latino community.”

Telemundo President and CEO Jim McNamara and COO Alan Sokol will continue to lead Telemundo following the completion of the transaction. McNamara will report to Lack. McNamara, a leading television executive with international expertise, has been CEO of the network since July 1999. Fully bilingual, he served as CEO of New World Entertainment and was president of Universal TV Syndication and International Sales. Sokol has been COO of Telemundo since August 1998 and was formerly with Sony Pictures and Savoy Pictures.

“I am thrilled about Telemundo becoming the newest member of the NBC family,” said McNamara. “The ability to draw on NBC’s expertise and resources to grow Telemundo’s reach and market position makes this an enormously attractive opportunity. NBC is demonstrating a strong commitment to the Hispanic market with this acquisition, and I look forward to helping them make the most of that commitment.”

Telemundo assets to be acquired by NBC under this agreement include:

– The national Telemundo network

– 10 full-power owned-and-operated stations in top Hispanic U.S. DMAs

– Los Angeles (2)

– New York

– Miami/Fort Lauderdale

– Houston

– Chicago

– Dallas/Fort Worth

– San Francisco/San Jose

– San Antonio

– Denver

– Puerto Rico

– 40 broadcast affiliates

– Two cable networks, Mun2 and Telemundo Internacional

The combination of NBC’s and Telemundo’s resources creates strategic opportunities across all divisions, including sales and promotion, station operations, news, entertainment programming and sports. Possibilities include the addition of Spanish-language versions of NBC shows on Telemundo, including late night and reality programs and the Olympics. National sales efforts can also be integrated, network cross-promotion can be initiated and NBC cable expertise can be leveraged to grow Telemundo’s national distribution.

In addition, NBC News, MSNBC and CNBC can offer a wealth of resources, including programming, raw footage, newsgathering support and operational expertise. Telemundo and NBC’s local stations are expected to combine forces to create bilingual news teams, co-branded weather reports and joint coverage of key local events including elections and cultural celebrations. Telemundo stations will have access to NBC News Channel’s resources, which will provide them with breaking news stories and feature material – including foreign, domestic and regional – to use in local news programming.

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