Comcast, NBCU File Merger Deal With Justice Dept.

Public interest, license transfer filings with FCC to follow

By John Eggerton -- Broadcasting & Cable, 1/26/2010 11:33:59 AM

Comcast and NBC Universal made their formal filing to the Justice Department Jan. 25 for review of their proposed merger. That will be followed shortly by its public interest filing and request for license transfer from the FCC.

Per the Hart-Scott-Rodino Act, mergers above a certain threshold must be submitted to review by either Justice or the Federal Trade Commission. The two divide up such reviews, with Justice getting the call in this case.

The FCC review goes beyond competition issues to public interest concerns.

The $30 billion deal involves NBCU borrowing $9.1 billion, which parent G.E. puts into a newly formed company along with NBC's assets (cable networks, broadcasting, film studio, theme parks).

Comcast contributes $7.25 billion of its assets (cable nets, regional sports nets, and some digital assets) into the new company, then pays G.E. $30 billion for a 51% interest. Comcast then has the option to buy half of GE's interest after five years, and the remainder after another three.

The reviews by Justice and the FCC are expected to take most of the year. Hill hearings on the deal in both the House and Senate are scheduled for next week.

National Association of Broadcasters President Gordon Smith said last week he expected lots of conditions to be put on the deal, relaying concerns by some affiliates that the new combined company could try to "program around" affiliates.

For its part, Comcast has pledged its allegiance to the broadcast network and station business.