NBC To Buy Weather Channel for $3.5B
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NBC Universal and buyout firms Bain Capital LLC and Blackstone Group LP agreed to buy the Weather Channel, after Landmark Communications Inc. put the cable network up for sale earlier this year.
The purchase price was about $3.5 billion, according to a person who asked not to be identified because the terms weren’t made public. The channel will be based in Atlanta and management will be provided by NBC Universal, the companies said in a statement.
NBC, owned by General Electric Co., adds a cable network that reaches 96 million households and can bolster the company’s own NBC Weather Plus channel and Web site. Landmark’s Weather.com drew 36.4 million American viewers in May, according to Reston, Va.-based researcher ComScore Inc., making it the 15th most-popular Internet property. NBC sites, excluding iVillage.com, didn’t rank in the top 50.
“It could embellish their presence,” an analyst with Barrington Research in Chicago, James Goss, said in an interview before the announcement. The deal also removes the Weather Channel as a competitor, he said.
Representatives of the buyers declined to comment beyond the statement, while a spokesman for Landmark, Richard Barry, couldn’t be reached for comment.
Landmark hired JPMorgan Chase & Co. and Lehman Brothers Holdings Inc. in January to seek buyers for the Weather Channel and review options to boost the value of the entire Norfolk, Va.-based company. Owned by the Batten family, Landmark has said the entire company may be broken up and sold, including its newspapers and TV stations.
GE, based in Fairfield, Conn., rose 40 cents to $26.91 in New York Stock Exchange composite trading on July 3. The shares have fallen 27% this year.
Blackstone, the New York-based firm that went public at the peak of the takeover boom last year, fell 9 cents to $17.23. The stock is down 22% this year. Closely held Bain is based in Boston.
NBC, based in New York, and the buyout firms became the lone contenders after Time Warner Inc., the world’s largest media company, dropped its bid on June 13. The same day, Landmark said it was in “exclusive talks” with the NBC-led group. The Batten family initially sought as much as $5 billion for the channel and Web site, the New York Times said May 31.