Comcast Corp. has struck a deal to sell its minority stake in A&E Television Networks, whose holdings include cable channels A&E, History and Lifetime, for $3 billion.
While the sale was expected, the price tag was higher than Comcast thought its holdings were worth. Two months ago, when Comcast first disclosed that it had exercised an option to unload its 15.8% piece of A&E Television Networks to majority owners Walt Disney Co. and Hearst Corp., it said its stake was worth $2 billion.
For Hearst and Disney, now 50-50 partners, the property and the prospect of getting 100% of it made it more valuable. The channels -- particularly History, which last month struck ratings gold with its "Hatfields & McCoys" -- are strong properties and cash cows.
The agreement is the culmination of a plan put in place three years ago for Hearst and Disney to eventually buy out NBC's piece of A&E Television Networks. In 2009, NBC had a 25% stake of A&E Television Networks that was reduced to 15.8% when Hearst and Disney rolled their Lifetime cable channel into the company.
Although Comcast could have kept an ownership position in A&E Television Networks until 2024, the partnership gave it the option to reduce its stake or sell it entirely as well.