DIS Walt Disney Co

Comcast Corp. on Thursday said it agreed to buy DreamWorks Animation SKG Inc. for about $3.8 billion, in a deal that could make the cable giant a rival to Walt Disney Co. in the lucrative family-entertainment business.

In the transaction, expected to close by the end of the year, DreamWorks Animation stockholders will receive $41 in cash for each DreamWorks share.

The purchase price is a premium of 27% over DreamWorks' close on Wednesday and a premium of 51% over its closing price on Tuesday, before The Wall Street Journal reported the companies were in merger talks.

DreamWorks Animation co-founder Chief Executive Jeffrey Katzenberg will become chairman of DreamWorks New Media, which will be comprised of the company's ownership interests in Awesomeness TV and NOVA.

"Having spent the past two decades working together with our team to build DreamWorks Animation into one of the world's most beloved brands, I am proud to say that NBCUniversal is the perfect home for our company," said Mr. Katzenberg.

He has been seeking a buyer for his studio, one of the last in Hollywood not part of a larger conglomerate, for several years.

Comcast's Universal Pictures studio has enjoyed success in recent years with its animated "Despicable Me" and "Minions" movies but is still a relatively small player.

Its parent company, though, has been moving aggressively to mimic Disney by using its animation properties to build out its consumer products and theme parks businesses, a strategy that could be accelerated by the addition of DreamWorks, which makes the "Shrek," "Kung Fu Panda," and "Madagascar" movies, among others.

Write to Anne Steele at Anne.Steele@wsj.com

(END) Dow Jones Newswires

April 28, 2016 09:45 ET (13:45 GMT)

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