Comcast unveiled plans Monday to split its media and technology businesses into two separately traded public companies as the entertainment industry reels from consumers abandoning the traditional TV bundle in favor of streaming services.
The tax-free spinoff will separate NBCUniversal and Sky into a standalone media company while the remaining Comcast business will concentrate on its broadband, wireless and business services operations, according to the company’s announcement.
The transaction is expected to close in about a year, subject to regulatory and board approval.
Investors cheered the move, sending Comcast shares up as much as 26% in early trading.
Comcast shareholders will own stock in both companies once the transaction is completed.
Comcast said it expects to retain a stake of up to 19.9% in NBCUniversal for up to one year following the separation before gradually monetizing the holding.
“This is a very exciting day for our company,” Comcast CEO Brian L. Roberts said in the press release.
“The transaction we are announcing will unlock a more entrepreneurial management approach and open up a multitude of new opportunities for each business.”
Under the shakeup, Mike Cavanagh will become CEO of NBCUniversal, while former Comcast Chief Financial Officer Michael Angelakis will return to lead Comcast as CEO following completion of the separation.