Comcast Corp, the parent of
Universal Pictures, agreed to buy DreamWorks Animation SKG Inc. in a deal
valued at $3.8 Billion, building on the studio’s film and TV franchises by
characters like Shrek as well as a US based production house.
Comcast will pay $41 a share in
cash for the animation studio. Buying the maker of the Shrek and Kung Fu Panda
films will bolster Comcast children lineup in theaters and add online assets
like Awesomeness TV, which targets millennial on YouTube. Comcast would make an
ideal parent for DreamWorks Animation, especially with its ownership of
Illumination, maker of hit films Minions and Despicable Me.
Glendale, California based
DreamWorks underwent a deep restructuring last year that reduced its workforce
by 18% and cut the number of films it made after a series of flops. Under DreamWorks
Animation, Illumination’s animators are largely based in Paris. With the acquisition,
Universal gains a fully-fledged US based movie and TV producer and distributor.
Comcast would pay DreamWorks a fee
of $200 Million if the deal is blocked by regulators. DreamWorks Animation
would also provide a source of content for Universal growing theme park
business. Universal already features Shrek rides at its parks in Florida, California,
Japan and Singapore. The company is building a theme park in China, where Kung
Fu Panda has been a big hit.
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