Published: Thu, June 21, 2018
Global Media | By Derrick Guzman

Disney Fox Acquisition Solidified With $71.4 Billion Deal

Disney Fox Acquisition Solidified With $71.4 Billion Deal

The Walt Disney Company has boosted its bid to acquire the bulk of Twenty-First Century Fox, raising its offering to $71.3 billion in cash and stock.

Fox's board is recommending the increased Disney offer to its shareholders and said that it was "superior" to the offer from Comcast last week. Disney will also assume about $13.8 billion of net debt of 21st Century Fox.

Rupert Murdoch, executive chairman of 21st Century Fox, said Fox believes Disney's offer is better than Comcast's - but the company said it would consider bids from other companies, including a revised offer from Comcast. But the NY company also said it is still weighing both offers, and noted that Disney's new bid doesn't have any provisions in it that prevents Fox from considering other offers.

Disney, meanwhile, could also benefit from Fox's wide range of television and film assets, which could feed into its streaming services, including a planned rival to Netflix sometimes referred to as Disneyflix. Disney (DIS) had initially bid $52.4 billion for Fox in December. Fox will have to pay Disney a $1.5 billion breakup fee if it backs out of that deal. Disney's previous offer was all stock.

In a call with analysts, Iger said he believes Disney's bid is superior to Comcast's from a regulatory perspective, and said that six months of dealing with regulators both in the USA and internationally has given Disney a 'meaningful head start'. The battle for Fox has transfixed the media business, pitting Disney chief Bob Iger and Comcast head Brian Roberts against one, as the control of one of Hollywood's most storied film and television brands hangs in the balance. Fox and Disney shareholders had been scheduled to vote on Disney's original bid July 10, but that meeting has been postponed.

With this deal, Disney will get ownership of 20th Century Fox movie and television studio, Fox's 22 regional sports channels, cable channels including FX and National Geographic, and Fox's portfolio of global operations, including a fast-growing pay-TV service in India.

Iger ruled out any split in assets with Comcast, as their agreement with Fox specifically doesn't allow for that.

But the NY company said it is still weighing both offers and noted that Disney's new bid doesn't bar Fox from considering other offers.

Fox's share price was up 5% in the immediate aftermath of the announcement, while Comcast shares fell 0.5%.

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