Walt Disney’s Bid For 21st Century Fox Assets Could Approach $80 Billion Value

Mirrored from Financial Review

Walt Disney Co is in the lead to acquire much of Twenty-First Century Fox’s media empire, though rival suitor Comcast Corp remains in contention, people familiar with the matter said.

The Murdoch family, which controls Fox, prefers a deal with Disney because it would rather be paid in Disney than Comcast stock, and expects a potential deal with Disney to be cleared by US antitrust regulators more easily, one of the sources said.

However, no deal between Disney and Fox is imminent and several issues have yet to be fully negotiated, the sources said.

CNBC had reported earlier on Tuesday (Wednesday AEDT) that a deal for Disney to buy Fox’s movie studio and television production assets for more than $US60 billion ($78.9 billion) could come as early as next week.

Current Fox shareholders would get one share of the Fox company that remains after the movie and television assets are sold plus shares of Disney in a fixed exchange ratio, CNBC reported.

Fox shares rose 1.6 per cent in midday trade in New York, lifting its market value to $US62.8 billion, while Disney tumbled 3 per cent. Comcast shares were down 0.9 per cent.

Disney would acquire Fox’s FX and National Geographic cable channels, its movie studio, the Star network in India and stakes in European pay-TV provider Sky. Fox would keep its news and business news divisions, its broadcast stations and Fox Sports, the sources said.

Reuters reported in November that Comcast, the largest US cable provider, had expressed interest in Fox assets.

Those assets would offer the opportunity for both Comcast and Disney to broaden their international distribution footprint.

They would also be a source of new content at a time when companies like Amazon.com and Netflix are spending billions to bulk up on programming. Comcast has steadily boosted its ownership of content over the years.

The Reuters sources asked not to be identified because the negotiations are confidential. Fox declined to comment, while Disney and Comcast did not immediately respond to requests for comment.

Any potential deal would follow the US Department of Justice’s decision to sue to block AT&T’s $US85.4 billion deal to buy Time Warner.

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