Back in December of 2017, 21st Century Fox (21CF) entered an agreement to sell its media and entertainment operations to the world’s biggest entertainment company, Disney. The deal has been moving forward and is currently under review. But now, the deal is under threat from a looming all cash bid from cable/media giant Comcast, its second bid which is expected to eclipse Disney’s current bid of $52 billion. Though the Murdochs who control 21CF and Disney CEO Bob Iger have said publicly that that deal is moving forward, it may be hard for 21CF shareholders to ignore a bigger all cash offer from Comcast which is expected to come in at $60 billion. Such an event may cause a riff between Fox boss Rupert Murdoch those shareholders. There is also a report that some shareholders are open to scrapping the Disney deal in favor of an all cash offer from Comcast. This possible new bid would be in addition to a formal bid Comcast made for British broadcaster Sky TV worth $31 billion indicating that the cable giant will move mountains to get its hands on Fox. Rupert Murdoch has been trying for some time now to take full control of Sky but has been hitting roadblocks. Mr. Murdoch had hoped that Disney would offer to buy the rest of Sky he doesn’t already own. But again, Comcast swooped in and shook things up with a bid of its own in an effort to force Mr. Murdoch to come to the table.
Some Recent History: It was Comcast that made an offer for 21CF first. But the offer was declined by 21CF over antitrust concerns. This opened the door for Disney which has been rumored to be on the hunt for a major acquisition to make its own offer of $52 billion.
Some Ancient History: Back in 2004, Comcast tried and failed to buy Disney. The cable giant at the time made a $54 billion offer to scoop up the mouse house. The offer Comcast made for Disney back then is just $2 billion more than Disney’s offer for Fox today. That 2004 deal fell apart after terms couldn’t be reached. Comcast went on to acquire NBC Universal.
Why Now?: When Comcast made its first offer for Fox, there was widespread concerns about a deal being able to get approval. Because of these concerns the deal never happened. But with the AT&T-TimeWarner merger looking positive, Comcast believes it has a good case to win the Fox assets, AT&T being a cable and telecoms company and all. Also, there is a “little company” called Netflix that has media giants on their toes and so a mad dash to control content is underway.
Several Fox investors said they would be open to terminating the company’s agreement, inked in December, to sell most of its media assets to Walt Disney Co if Comcast Corp follows through on its plan to launch a rival all-cash bid for as much as $60 billion.
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