Comcast has announced plans to spin off its media arm, which includes Sky and NBCUniversal, into a separate publicly listed company. The move comes eight years after the US group acquired Sky's European operations for £31bn. Completion of the separation is expected to take a year.
Under the plan, existing shareholders will hold shares in both Comcast, which will focus on broadband and mobile services, and the new media company. Brian Roberts, co-chief executive of Comcast, said the separation would “unlock a more entrepreneurial management approach” for each business. The new entity will be led by Mike Cavanagh, currently co-chief executive of Comcast.
The spin-off raises questions about the future of Sky News, which Comcast committed to fund for a decade when it bought Sky in 2018. That commitment is nearing its end, and concerns have been raised over continued funding. Sky News has an annual budget of about £100m but is thought to make losses of up to £80m.
Sky is also close to announcing a £1.6bn takeover of ITV's media and entertainment operations. If cleared, the NBCUniversal spin-off would control 40% of ITN, making it the largest shareholder in the news provider. Comcast has previously sold Sky Deutschland and written down Sky's value by nearly a quarter.
Analysts suggest the new company could attract interest from Netflix, which recently attempted to buy Warner Bros Discovery. Mike Proulx of Forrester noted that Peacock, NBCUniversal's streaming service, paired with a major studio, mirrors Netflix's ambitions. Comcast has also recently spun off US cable networks MSNBC, E! and SYFY into a separate company.
