Blackstone Deals Universal Orlando to NBCU in $3.16B Sale

(Reuters) – NBC Universal and the Blackstone Group said on Monday they had reached an agreement under which NBCU will buy out the private equity firm’s 50 percent stake in Universal Orlando for around $1.025 billion.

The deal values the theme parks transaction at about $3.165 billion, including debt, and is expected to close on July 1.

A person familiar with the transaction said the deal valued the parks at about seven times trailing earnings before interest, taxes, depreciation and amortization.

Blackstone’s equity investment since July 2000 was about $275 million to $300 million so it is believed to have earned about three times its investment.

After the transaction, NBC Universal, which is controlled by Comcast Corp, will own 100 percent of Universal Studios Florida, Universal’s Islands of Adventure and Universal CityWalk.

The purchase price will be funded with cash on hand at NBC Universal, borrowings under its existing credit facility and a one-year $400 million note to NBC Universal from an affiliate of Comcast.

The parks’ earnings have been given a boost since last year’s opening of the Harry Potter-themed rides at Universal Orlando, based on the blockbuster series of movies and books.

The 20-acre Harry Potter park recreates the Hogwarts School of Witchcraft and Wizardry and other places dreamed up by J.K. Rowling in her fantasy novels about the boy wizard and his friends.

Helped by the attraction, Universal Orlando’s park attendance rose by about 20 percent in 2009. Revenue last year rose 40 percent to $1.13 billion.

(Reporting by Yinka Adegoke and Nadia Damouni; Editing by Phil Berlowitz, Gary Hill)