Dow Jones to end international ties with CNBC

(Re-updated at 03:00 pm)
Televisionpoint.com Team
Dow Jones & Company today announced that it has entered into a definitive agreement with NBC Universal to transfer its 50% equity interests in both CNBC Europe and CNBC Asia, as well as its 25% interest in CNBC World, to NBC Universal as of December 31, 2005 for nominal consideration, subject to any necessary regulatory or legal approvals.

The transfer of its interest in CNBC Asia is also subject to the mutually satisfactory resolution of certain structural matters between now and December 31, 2005. There are no plans to alter the Dow Jones and CNBC licensing relationship in the US

Peter R. Kann, chairman and chief executive officer of Dow Jones, said, "We value our long and profitable relationship with CNBC. At CNBC US, We look forward to continuing it under our existing US license agreement. At CNBC International and World, we and NBC Universal have agreed for Dow Jones to exit the partnership to eliminate our share for business reasons and simplify NBC Universal's ability to deploy its assets to continue to grow these operations. We look forward to supporting NBC Universal's efforts."

MR Kann continued, "This is the latest in a series of moves by Dow Jones to improve profits and strengthen our portfolio. We're investing in exciting new initiatives where we have strong competitive advantages such as the launch of the Weekend Edition of The Wall Street Journal, the acquisition of MarketWatch and the repositioning of our international print and online operations, and exiting those where we do not."

The Company expects to record a one-time, after-tax special charge of approximately $36.7 million, or 44 cents per diluted share, in the second quarter. About $32.1 million, or 39 cents per share, will be a non cash write-off of its carrying value in the transferred assets, and the remaining $4.6 million, or 5 cents per share, is to cover its maximum after-tax cash funding commitment for the balance of 2005. The Dow Jones share of losses from CNBC Europe, CNBC Asia and CNBC World totaled $17 million in 2004. The Company will provide an update on the impact of this transaction on third and fourth quarter results during the Company's second quarter analyst call on July 21, 2005.