21 June, 2018
Disney has raised its offer to acquire the studio and cable network assets of 21st Century Fox to $71.3 billion in cash and stock, reports Deadline. This valuation is a $3 premium over Comcast's $35 a share all-cash offer that they made just last week.
Analysts pointed out that the stock component of the Disney offer would be non-taxable as a swap of assets, making it more hard for Comcast to make a higher bid. Fox CEO Rupert Murdoch said the company "firmly believes" that the combination with Disney is a good fit.
Quoting Bloomberg News, CNBC reported that Disney was nearing U.S. Justice Department approval on the deal. All of a sudden, it's like that girl in high school who everyone wants to ask out, as over the course of the past few weeks, the bid to acquire most of its assets has been raised by almost $20 billion.
This stake now stands at 39.1% but Fox is seeking to take full control of the business prior to selling it on to Disney. Disney had initially bid $52.4 billion for Fox in December. Though it's worth noting a federal judge did approve of the $85.4 billion merger between AT&T and Time Warner on June 12, indicating whatever deal Fox does accept will likely be signed off on as well.
Bloomberg is now reporting the Walt Disney Company's potential purchase of 21st Century Fox's entertainment assets is about to pass antitrust approval from USA regulators, according to sources who know about the matter. But a sky-high Comcast bid will make that tricky. Although both Disney and Comcast are making these offers so they can be more competitive in the streaming space and compete with Netflix, at the end of the day this is going to mean fewer choices for consumers as giant companies like Disney and Comcast become even bigger.
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Disney Chief Executive Officer Bob Iger played down any antitrust concerns in a deal, and said he has been working with regulators around the world for the past six months.
Fox shares jumped 8 percent to $48.23, while Comcast rose 2.1 percent to $33.52. In 2017, Disney's Buena Vista held a dominant 21.8% of the movie market share, while 20th Century Fox held 12%.
It remained unclear whether Comcast would increase its bid, which was announced as an all-cash deal in a bidding war that will leave a top player in Hollywood and the global television market.
The deal would include Fox film and TV studios, some cable networks and worldwide assets, but not Fox News Channel or the Fox television network.
Fox said it will postpone its special shareholders meeting in order to provide stockholders the opportunity to evaluate Disney's amended offer.
The Fox sale would not include major assets such as the Fox News Channel, Fox Business Network, and Fox Broadcasting Company.