Disney increases offer for Fox in bidding war with Comcast
A high-stakes bidding war for the majority of the assets of Rupert Murdoch’s 21st Century Fox media and entertainment group intensified today, with Walt Disney, the US media giant, increasing its offer to more than $71 billion, as it seeks to trump a rival hostile offer from Comcast, owner of the US NBC TV network, which was itself recently increased to $65 billion.
Disney has switched from an all-stock offer to a 50-50 mix of cash and shares (Comcast’s bid is all-cash), in its latest move to snare a group that includes a 39-per-cent stake in Sky, the European pay-TV operator.
Disney’s bid has the backing of Murdoch, Fox’s executive chairman (pictured), who said: “We are extremely proud of the businesses we have built at 21st Century Fox and firmly believe that this combination with Disney will unlock even more value for shareholders as the new Disney continues to set the pace at a dynamic time for our industry. We remain convinced that the combination of Fox’s iconic assets, brands and franchises with Disney’s will create one of the greatest, most innovative companies in the world.”
Bob Iger, Disney’s chief executive, said: “The acquisition of 21st Century Fox will bring significant financial value to the shareholders of both companies and after six months of integration planning we’re even more enthusiastic and confident in the strategic fit of the assets and the talent at Fox.”
Last December, Disney agreed to buy the majority of Fox for $52.4 billion in stock. The deal included Fox’s movie studios, networks National Geographic and FX, India's Star TV, and stakes in Sky, Endemol Shine Group and Hulu, as well as regional sports networks.
Neither bid includes USA’s Fox News, Fox Sports 1 nor the Fox broadcast network and its TV stations, which will be spun off into a new company.
The bid is the latest move in a worldwide trend towards integration and consolidation involving telecoms and media companies.
Earlier this month, Matt Hancock, the UK’s culture secretary, said that he would approve 21st Century Fox’s own proposed deal to acquire control of Sky.
Fox had previously agreed a deal worth £11.7 billion ($15.6 billion) to acquire the 61 per cent of Sky it does not already own, but it was awaiting regulatory clearance in the UK after the Competition and Markets Authority provisionally blocked the takeover on the grounds of media plurality.
Sky has a total of 22.9 million subscribers in the UK, Ireland, Germany, Austria and Italy.
In April, Comcast tabled a separate £22-billion bid for Sky, putting it in competition with Fox. This month, Hancock also announced that Comcast’s bid for Sky would not require regulatory approval in the UK.