NBC, one of the nation's
least popular TV networks
, is in serious trouble. In February, the
Los Angeles Times'
Scott Collins detailed NBC's painful decline.
"The Broadway drama 'Smash'…bombed on its return, with low
ratings that shocked even TV veterans," Collins wrote. "The
medical thriller 'Do No Harm' posted the worst numbers ever for a
new network drama."
NBC also fell from fourth to fifth place in overall network
Despite the decline, Comcast (NASDAQ:
decided to purchase
General Electric's (NYSE:
) remaining stake in NBC for more than $16 billion.
That is quite a hefty price tag considering that it only
accounts for roughly 50 percent of the company.
"I think they…paid quite a healthy price," David Marcus,
co-founder, CEO and CIO of Evermore Global Advisors, told
Benzinga. "It looked like a very rich price, but at the same
time, we'll know over time."
For the sake of comparison, Marcus pointed to Rupert Murdoch's
News Corp. (NASDAQ:
), which "paid some crazy number to get Monday Night
"Within just a few years that was sort of a low number," said
Marcus. "Comcast has surprised people a lot over the years.
They've made very big acquisitions. They've transformed
themselves from sort of a regional cable operator to a powerhouse
media company. And I think they've for the most part delivered
the promise and they've created a lot of value for the
Shifting the focus to European markets, Marcus compared NBC to
ailing (but promising) firms in Europe.
"The key is, you want people out there to be overpaying if
you're a seller, obviously," said Marcus. "And that's the other
thing that's happening -- when you're in a low-growth
environment, companies typically start buying growth because
their businesses aren't growing. So they buy assets, divisions,
products and services. You want to own the targets,
"I think that's another reason why Europe is compelling --
because the companies are not expensive, probably have decent
balance sheets overall, and they are targets. If you are a
dollar-denominated business, the Euro has been weak, so you have
a strong currency to buy assets over there. You may not be
getting growth, but maybe you're adding onto your product line.
You're building out your services. You're taking away a
competitor that you once had. The key is, you might be buying a
company in Germany, but 80 percent of their business is outside
of Germany. So it's more of an international business."
Louis Bedigian is the Senior Tech Analyst and Features Writer
of Benzinga. You can reach him at 248-636-1322 or
firstname.lastname@example.org. Follow him
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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