NBC, GE Buy Stake in ValueVision
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NBC and GE Equity jointly agreed to acquire 19.9 percent of ValueVision preferred stock and common stock purchase warrants. NBC and GE Equity to receive one seat on ValueVision's board. In addition, NBC and GE Equity have the option to increase their shared equity stake to 39.9 percent, subject to ValueVision shareholder approval.
NBC will be responsible for all of ValueVision's cable and affiliate relations. ValueVision will rely on NBC's creative and technical initiatives for program development. NBC will also assume a leadership role in redesigning ValueVision's Internet shopping site. The companies plan to rebrand ValueVision's television home-shopping network with an Internet portal during the year.
The companies contend the transaction marks the first time that a broadcast network has taken a significant equity stake in a television home-shopping network with the potential for a significant electronic commerce partnership through interactive cable boxes and Internet portals. ValueVision, an electronic and print media direct marketing company, operates the third largest television home-shopping network in the U.S. NBC also holds an equity stake in online portal Snap!.
"The combination of the strength and credibility of GE and NBC, increased cable distribution, and innovative entertainment program development position our companies to lead in the area of electronic commerce," he added.
"NBC has a proven track record for growing distribution of cable networks with MSNBC and CNBC -- we hope to help ValueVision strengthen its position in the cable television world," said Tom Rogers, president of NBC Cable and executive vice president, NBC.
"As the TV and PC converge, access to electronic revenue streams like home shopping through cable and Internet will become extremely valuable. This partnership strategically positions NBC and ValueVision for this future opportunity," Rogers said.