NBC Tuesday agreed to invest another $25 million in online community Xoom.com Inc. and plans to speed its $30 million investment into the pending NBC Internet venture, known as NBCi.
NBC’s shares were purchased at an average price of $57.30 a share, well above Monday’s closing price of 43-5/8.
“NBC’s $55 million investment demonstrates our increased commitment to Xoom.com and NBCi. The deal restructuring enables us to have an increased long-term equity position in NBCi,” said Tom Rogers, NBC executive vice president and president of NBC Cable.
The deal comes on the heels of last month’s merger between Xoom, NBC and Snap.com!, co-owned by NBC and CNET, to create NBC Internet, or NBCi. Announced in mid-May, NBCi will reportedly be the seventh-largest Internet site and will be the first publicly-traded Internet company aligned with a major broadcaster. Snap! will be the venture’s umbrella consumer brand.
The merger is expected to close by October. NBC’s additional investment annonced Tuesday must also receive antitrust approval.
NBC’s stake in NBCi will remain 49 percent after the deal is closed and it will have control over six of the new venture’s 13 board of director positions. NBC will also have the right to increase its stake through the conversion of long-term debt to 54 percent. CNET would continue to hold 13 percent and Xoom.com shareholders and option holders would still own a 33 percent stake.