Change of ownership at Universal?

[TisBit]

According to the Orlando Sentinel, Blackstone Group has excercised their right of first refusal on NBC Universal, if NBC doesn't buy out Blackstone Group, Blackstone can offer the entire park up for sale to a third party. Could get kind of interesting in the next year or so.

http://www.orlandosentinel.com/busi...fers-sell-universal-s20110316,0,5366092.story

The Blackstone Group, which owns 50 percent of Universal Orlando, has offered to sell its stake in the theme park to NBCUniversal, which owns the other half.

A Security and Exchange Commission filing states that Blackstone has "triggered its right of first refusal," essentially offering to sell its half of the Central Florida theme park to NBCUniversal.

NBCUniversal has until June 12 to respond to the Blackstone offer. If the media and entertainment giant doesn't accept, Blackstone has the right to market the entire company — including NBCUniversal's 50 percent share — to third-parties, the filing states.

As described in the filing, under the terms of the companies' partnership agreement, Blackstone would have 270 days to sell the entire theme park.

Both companies would be required to sell, but only if the third-party buyer offered at least 90 percent of the price for both companies' interests, as determined by the amount for which Blackstone offers to sell its stake to NBCUniversal. Essentially, the third party would have to offer to pay 180 percent of Blackstone's asking price for its half.

Were the 270 days to pass, or if the companies agreed in writing to abandon the process of seeking a third party, the filing states that Blackstone would be prohibited from making another offer for one year.

NBCUniversal spokeswoman Cindy Gardner told The Wall Street Journal that the company is "studying the proposal and considering our options."

Universal Orlando is the attraction/resort that includes Universal Studios, Islands of Adventure and CityWalk. Islands of Adventure has been enjoying record-setting attendance since the opening last year of The Wizarding World of Harry Potter.

 

[Metro West]

Yeah...I saw that this morning. I don't believe for a second that NBCUniversal would pass on the opportunity and allow their parks to be sold to a third party. I'm really surprised that Blackstone is selling considering they own the Busch parks (four in this area alone) and all the money Universal is making from HP. But...I seem to remember something in the paper a few months ago regarding a negotiation of some kind between Comcast and Blackstone. I guess it didn't go well and Blackstone wants out. It still doesn't make sense they are willing to walk away from all the HP money.

I guess we'll have to wait and see what happens.

I wonder how it's going to be before the rumors start about Disney buying Universal?

 

[Peter Pirate 2]

Yeah...I saw that this morning. I don't believe for a second that NBCUniversal would pass on the opportunity and allow their parks to be sold to a third party. I'm really surprised that Blackstone is selling considering they own the Busch parks (four in this area alone) and all the money Universal is making from HP. But...I seem to remember something in the paper a few months ago regarding a negotiation of some kind between Comcast and Blackstone. I guess it didn't go well and Blackstone wants out. It still doesn't make sense they are willing to walk away from all the HP money.

I guess we'll have to wait and see what happens.

I wonder how it's going to be before the rumors start about Disney buying Universal?

Why shouldn't Disney wish to buy Universal if the price is right? They bought their competitor before (PIXAR) and it has turned out well.

 

[Figment632]

Disney innot buying Universal it will be Comcast.

 

[Metro West]

Why shouldn't Disney wish to buy Universal if the price is right? They bought their competitor before (PIXAR) and it has turned out well.

I imagine Disney would like to buy out a competitor...but that's not going to happen. As I said...Universal will not allow their parks to be sold to a competitor.

What do you think Disney would do if they did buy Universal? I'm curious about your ideas of what a Disney owned Universal/IOA resort would mean.

Disney innot buying Universal it will be Comcast.

No...this would be the theme parks...not Comcast. This has nothing to do with Comcast. This agreement has to do with NBCUniversal and Blackstone. So Disney would not be buying Comcast.

 

[Figment632]

1. Disney is not buying them
.2. Disney would never buy just the theme parks because they would have to pay to use the UNI names and products.

Again there is 0 no less than 0 chance that Disney will buy the UNI theme parks.

 

[Jessica527]

I agree, it would now be Comcast buying Universal. Who knows what is going to happen. Great OP! Looking forward to the news!

 

[Metro West]

I agree, it would now be Comcast buying Universal. Who knows what is going to happen. Great OP! Looking forward to the news!

Comcast already has controlling interest in the parent company NBCUniversal.

According to the article the only question is....

Will NBCUniversal purchase the other 50% stake in the theme parks from Blackstone or will they allow 100% of the theme parks to be sold?

Again...this has nothing to do with Comcast.

 

[Figment632]

Comcast already has controlling interest in the parent company NBCUniversal.

According to the article the only question is....

Will NBCUniversal purchase the other 50% stake in the theme parks from Blackstone or will they allow 100% of the theme parks to be sold?

Again...this has nothing to do with Comcast.

Comcast is the parent company of course if NBC bought they rest (which they will) it would have something to do with comcast. If NBC does something this big I assure you Comcast will be involved.

 

[Metro West]

Comcast is the parent company of course if NBC bought they rest (which they will) it would have something to do with comcast. If NBC does something this big I assure you Comcast will be involved.

I beg to differ. This agreement between Blackstone and NBCUniversal predates Comcast's ownership and would not be in on the agreement. Now I agree Comcast might "suggest" options but it's ultimately btween Blackstone and NBCUniversal. Show me in the article where it mentions Comcast's involvement in the process.

 

[Figment632]

I beg to differ. This agreement between Blackstone and NBCUniversal predates Comcast's ownership and would not be in on the agreement. Now I agree Comcast might "suggest" options but it's ultimately btween Blackstone and NBCUniversal. Show me in the article where it mentions Comcast's involvement in the process.

Comast owns NBC if they say but the rest of UNI NBC has 0 choice in the matter.

 

[TisBit]

Disney would not want to buy Universal....there is no incentive for them to get more lands or parks that they would have to invest heavily in to make them "Disney" brands.

I am betting that Blackstone already has something on the table or are looking to liquidate while Universal is doing well. They may have a buyer in line and now it is up to NBCUniveral to pony up the money or lose controlling interest. Even NBCUniversal might looking for an out and it is an orchestrated move between the two to sell to a third part.

Whatever the plans, this didn't just pop out of left field.

 

[Metro West]

Whatever the plans, this didn't just pop out of left field.

I agree...I think this comes from a falling out between Blackstone and Comcast a few months ago.

 

[nytimez]

I beg to differ. This agreement between Blackstone and NBCUniversal predates Comcast's ownership and would not be in on the agreement. Now I agree Comcast might "suggest" options but it's ultimately btween Blackstone and NBCUniversal. Show me in the article where it mentions Comcast's involvement in the process.

Doesn't matter when the agreement was made. Comcast has majority ownership over the company now and will make the decision one way or the other. It's not a "suggestion."

Also, Blackstone is of course only interested in cash - and by cold cash alone, Universal parks have never been more valuable. It's the best time to cash in on their 50 percent.

 

[Metro West]

Doesn't matter when the agreement was made. Comcast has majority ownership over the company now and will make the decision one way or the other. It's not a "suggestion."

Glad you have inside information.

I guess we'll see won't we.

 

[ASteelersMidget]

Wait. If 100% is sold to a different company, what happens to the "No names of already used marvel characters at parks east of the mississippi" rule/aggreement from when disney bought marvel?????

 

[Peter Pirate 2]

I imagine Disney would like to buy out a competitor...but that's not going to happen. As I said...Universal will not allow their parks to be sold to a competitor.

What do you think Disney would do if they did buy Universal? I'm curious about your ideas of what a Disney owned Universal/IOA resort would mean.

I don't think it will happen either and honestly I wouldn't want it to happen. The last thing we, as guests, need is loss of competition for Disney, a company already showing little interest in giving us much these days.

But I personally think it would a great move for Disney, even at non bargain basement prices and assuming they could meet regulatory hurdles, of course.

The takeover would be seemless on the outside. TM's convert to CM. The Parks become Disney's Universal Studios and Disney's Islands of Adventure. Disney would be thrilled with the restaurant and hotel agreements in place (the fact that they'd have to run neither) and the fact that City Walk is just rental space fits perfectly with the modern day disney mindset as well.

Disney could choose to introduce Mickey and the gang to Universal in various ways if they're concerned with the Disney tie in but I think they've proven with ESPN, ABC and such that it probably wouldn't be necessary.

I'll close by saying that while I think it would be a great move for Disney, i think it would be a terrible move for me (the guest). Sea World would be the only competition and they're not strong enough to dictate, or even cause consideration on price structure and such to the mouse.

 

[TisBit]

Wait. If 100% is sold to a different company, what happens to the "No names of already used marvel characters at parks east of the mississippi" rule/aggreement from when disney bought marvel?????

It would be interesting to see the clauses that were involved in the leasing of those brands/characters. It wouldn't surprise me if they expire upon sale/closing of the park.

I don't think it will happen either and honestly I wouldn't want it to happen. The last thing we, as guests, need is loss of competition for Disney, a company already showing little interest in giving us much these days.

But I personally think it would a great move for Disney, even at non bargain basement prices and assuming they could meet regulatory hurdles, of course.

The takeover would be seemless on the outside. TM's convert to CM. The Parks become Disney's Universal Studios and Disney's Islands of Adventure. Disney would be thrilled with the restaurant and hotel agreements in place (the fact that they'd have to run neither) and the fact that City Walk is just rental space fits perfectly with the modern day disney mindset as well.

Disney could choose to introduce Mickey and the gang to Universal in various ways if they're concerned with the Disney tie in but I think they've proven with ESPN, ABC and such that it probably wouldn't be necessary.

I'll close by saying that while I think it would be a great move for Disney, i think it would be a terrible move for me (the guest). Sea World would be the only competition and they're not strong enough to dictate, or even cause consideration on price structure and such to the mouse.

The problem is infrastructure. Disney will not want to run seperate parks so far away. They would need some other type of bus service, etc to get guests there from WDW and vice versa. No one would really want to only visit one or the other...especially if the tickets permit entrance to those parks. The rides/parks are also not set in the Disney standard (layout, theming, etc....not saying bad, just different thought process was used) and likely would be more heartburn than benefit.

I think if Disney wanted to buy more parks they would have made serious bids on Busch Gardens, at least that could have opened up other markets to them.....WDW could likely build two more parks with the costs that it would take to buy Universal, they already have the land and that is the most expensive part.

 

[Jalva22]

It still doesn't make sense they are willing to walk away from all the HP money.

Pure speculation on my part, but it could be they are thinking that HP has made the parks as valuable right now as they are ever going to be, and are maximizing what they can get for the parks by selling now. Seeing a better deal in maximized present value of the parks than in future value of the cash flows.

Given the height of HP popularity at the moment and figuring that cannot last forever, it might not be a bad bet.

Or, HP could end up living on as another Star Wars (or, probably a better comparison, another Lord of the Rings since its maintained popularity will reside in how well the books endure), which would make it a terrible bet!

 

[TisBit]

Pure speculation on my part, but it could be they are thinking that HP has made the parks as valuable right now as they are ever going to be, and are maximizing what they can get for the parks by selling now. Seeing a better deal in maximized present value of the parks v. future value of the cash flows.

Given the height of HP popularity at the moment and knowing that cannot last forever, it might not be a bad bet.

Or, HP could end up living on as another Star Wars past the ending of the movies, which would make it a terrible bet!

Also, in order to keep capatalizing on the HP success, they need to continue to invest and update it. It won't last as it is, without bringing something new every few years. Right now HP is only a small part of one park and fequently the rest of the park is not drawing the same crowds.

I am betting that it is a three way combination of Blackstone knowing now is the time to sell if there was one, not wanting to invest more into HP in the future and with Busch Gardens and Seaworld purchase, they will be in direct competition with Universal, there is no reason to compete with yourself.