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Comcast Buys Film Company DreamWorks For $3.55 Billion

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The product engineering floor at the Comcast Center as seen Monday, Oct. 19, 2015 in Philadelphia, Pennsylvania. Comcast Cable is one of the nation’s largest video, high-speed Internet and phone providers to residential customers under the Xfinity brand as well as to businesses. Comcast logo pictured. (Jeff Fusco/AP Images for Comcast)\n

NEW YORK (AP) -- Comcast is buying DreamWorks Animation, the film company behind the Shrek, Madagascar and Kung Fu Panda franchises, for approximately $3.55 billion, strengthening its presence in the important and growing business of children's entertainment.

Comcast Corporation will host a conference call with the financial community to discuss financial results for the fourth quarter and full year 2015 on Wednesday, Feb. 3, 2016. Comcast will issue a press release reporting its results earlier that morning. (Jeff Fusco/AP Images for Comcast)

DreamWorks stockholders will receive $41 for each share they own. That's a 24 percent premium to the company's Wednesday closing price of $32.20. The companies put the deal's value at about $3.8 billion.

DreamWorks will become part of the Universal Filmed Entertainment Group, which includes Universal Pictures. The studio has had some successful children's movies recently, including the Despicable Me and Minions franchises.

Comcast said the deal gives NBCUniversal a "broader reach to a host of new audiences in the highly competitive kids and family entertainment space, in both TV and film." In addition to the cartoon franchises, DreamWorks also owns what Comcast called a "thriving TV operation" with an extensive trove of family programming.

Once the deal closes, DreamWorks co-founder and CEO Jeffrey Katzenberg will become chairman of DreamWorks New Media. He'll also serve as a consultant to NBCUniversal, a unit of Comcast Corp.

Earlier this year, DreamWorks expanded a licensing deal with Netflix Inc. to have the online video service feature more of its series and movies. The expanded licensing agreement announced in January allows Netflix to showcase several new DreamWorks series, including "Trollhunters," a fantasy created by acclaimed movie director Guillermo del Toro. The deal gives Netflix more video likely to appeal to children, an audience segment that has played an important role in its service more than doubling in size to 69 million subscribers during the past three years.

The boards of both Comcast and DreamWorks have approved the transaction, which is targeted to close by year's end.

Shares of Comcast rose 58 cents to $61.88 in morning trading Thursday, while shares of DreamWorks Animation SKG Inc. leapt $7.80, or 24.2 percent, to $40.

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