Comcast's faint hopes that its $30 billion NBC Universal joint venture would close by the end of 2010 were dashed Wednesday, after the company conceded that the federal approval process will likely drag on until early next year.
Comcast announced the NBCU joint venture last December. The MSO had hoped that the deal would receive the necessary government approvals before the end of the year, but in the past several months as the JV has wound through the process, it became clear that it would not make that self-imposed deadline. According to sister publication Broadcasting & Cable, Federal Communications aides have rated the chances of an approval this year as "slim to none," for some time now, mainly because the deal won't be voted on by the full commission until early January. The JV is awaiting a passing grade from the Federal Communications Commission and the Dept. of Justice.
Comcast would own 51% of the JV, with General Electric Co. controlling the rest. Comcast announced the management team for the JV in November.
"We believe the FCC and the DOJ continue to make substantial process toward approval of our transaction. However because of the lead time required to prepare for a close, it now appears that we will not be able to close the transaction with GE relating to NBC Universal by year-end," Comcast said in a statement. "We have notified our transition teams that there will not be a December 31 closing. We believe the regulatory review puts us on track for a closing in January 2011. We are appreciative of the hard work by the FCC and DOJ staff and by our own transition teams, and look forward to completing the process early next year."
If FCC chairman Julius Genachowski wants to get the 200-page draft of the order into the hands of those on other commissioner's staffs who need to review them, he will need to do so soon. Many are heading out for the holidays, and, along with commissioners, will have commitments at the Consumer Electronics Show at the beginning of January (6-9).
The New York Times first broke the story that the venture would have to wait until next year to close. In a memo to NBCU staff Wednesday obtained by Multichannel News, CEO Jeff Zucker -- who will not make the transition to the new JV -- stated that the approval process and some bookkeeping matters would delay the closing.
"We have made substantial progress this month with both the FCC and the Department of Justice, and expect that we will get a ‘green light' in January," said Zucker in the memo. "The official close of the transaction would happen shortly after government approval."