With Comcast on track to spin off Versant by year end, CFO Jason Armstrong said more details of the standalone linear network company are coming soon and the new entity will enter the world solid and with “lots of options.”Comcast and all traditional media companies faced a choice amid cable’s inexorable decline as subscribers dwindle but the business still throws off cash. “Either they are cash generating and permanently in support of the existing growth businesses, or they are separable,” Armstrong posited at a Citi TMT (tech, media and telecom) conference. “And we came to the conclusion these businesses were separable, saying that in spinning it off we want it really well positioned. And we’ve gone out of our way to say, ‘How do you do that?’.One is making sure it’s conservatively leveraged, he said, meaning it has a lower amount of debt compared to equity. “I won’t give you the number but the Form 10 will be out there shortly so that will [have] Versant’s strategy, their capital structure. And then they’ll be out on the road talking to everybody once the Form 10 is out. So I will let them articulate that,” he said, referring to the SEC filing registering new securities that’s the next step in the separation process.“With a focused and strong management team, with pretty impressive cash flow that comes out of those business, and with a conservative capital structure, they are going to have a lot options. And, at the same time, it really helps clarify who we [Comcast] are.”Basically, the former parent will be a slimmed down mix of about 60% of the former company, the parts that are growing the fastest or have the most potential to do so. That’s streaming with Peacock and its beefed up sports lineup with the NBA, the film and television studios, the NBC broadcast network, NBC Sports and Bravo on the entertainment side. Parks and experiences is expected to be a major driver as well inside NBCUniversal. Division head Mark Woodbury outlined growth plans there at a conference yesterday. They will sit alongside Comcast’s large broadband and connectivity businesses.Versant, run by CEO Mark Lazarus, was announced last fall and has been unveiling its executive suite, programming team and board of directors throughout the spring and summer. Wall Streeters and potential investors are keenly interested in the amount of debt to be placed on the new company — in this case and even more so in the upcoming split of more debt-laden Warner Bros. Discovery.Cable assets to be carved out in with Versant include cable channels MSNBC, CNBC, E!, Syfy, Golf Channel, Oxygen and USA, along with digital assets like Fandango, Rotten Tomatoes, GolfNow and Sports Engine.
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