Disney’s bid for Fox assets gains momentum: sources

FILE PHOTO: The Twenty-First Century Fox Studios flag flies over the company building in Los Angeles
FILE PHOTO: The Twenty-First Century Fox Studios flag flies over the company building in Los Angeles, California U.S. November 6, 2017. REUTERS/Lucy Nicholson /File Photo

December 5, 2017

By Greg Roumeliotis and Jessica Toonkel

(Reuters) – Walt Disney Co <DIS.N> is in the lead to acquire much of Twenty-First Century Fox Inc’s <FOXA.O> media empire, though rival suitor Comcast Corp <CMCSA.O> remains in contention, people familiar with the matter said on Tuesday.

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 U.S. 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.

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

Fox is exploring a potential sale as it is has been considered undervalued relative to its peers, said Brian Wieser, an analyst at Pivotal Research.

“At the beginning of this year, Fox was the only buy-rated stock I had because it was so depressed relative to everything else in the sector,” Wieser said.

Fox Chief Executive James Murdoch, speaking at the UBS Global Media and Communications Conference in New York on Tuesday, declined to comment on reports about a potential sale.

“It’s always good to look at what’s going to create the most value for our shareholders,” he told attendees.

CNBC had reported earlier on Tuesday that a deal for Disney to buy Fox’s movie studio and television production assets for more than $60 billion could come as early as next week.

Fox shares were up 0.57 percent in late afternoon trading, while Disney was down 2.45 percent. Comcast shares were down 1.56 percent.

Disney, which has a market value of around $166 billion, would acquire Fox’s FX and National Geographic cable channels, its movie studio, the Star network in India and stake in European pay-TV provider Sky PLC <SKYB.L>.

Fox anticipates that its deal to buy the remaining 61 percent stake of Sky, which has been held up by regulators, will be approved in the first half of 2018. Any deal for Fox would include the remaining stake of Sky, sources have told Reuters.

Fox would keep its news and business news divisions, its broadcast stations and Fox Sports, the sources said.

Reuters reported in November that Comcast, which is the largest U.S. cable provider and has a market value of around $188 billion, 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 Inc <AMZN.O> and Netflix Inc <NFLX.O> are spending billions to bulk up on programming. Comcast has steadily boosted its ownership of content over the years.

Any potential deal would follow the U.S. Department of Justice’s decision to sue to block AT&T Inc’s <T.N> $85.4 billion deal to buy Time Warner Inc <TWX.N>.

(Reporting by Greg Roumeliotis and Jessica Toonkel in New York; Additional reporting by Laharee Chatterjee and Munsif Vengattil in Bengaluru and Anjali Athavaley in New York; Kate Holton in London, Lisa Richwine in Los Angeles; Editing by Saumyadeb Chakrabarty and Meredith Mazzilli)

  • NAVYNUKE

    Fox is the last major media outlet not owned by leftists, the problem being that once they become assimilated they will lose their viewership, credibility, and monetary value. Still, it’s worth it to the globalists. These Bilderbergs have more money than they know what to do with, and they truly believe they can silence all opposition by buying them out. Will they succeed? OANN, anyone?

  • No Mas

    Disney is LIBERTARD!!!! Will eliminate all non communists from what is left of unbiased media

  • monorprise

    This would be the end of fox as a less liberal outlet. It was Disney that distroyed ESPN. Disney is run by extreme leftist. Has since Walt died.
    Disney is already a near Monopoly it must be prohibited from aquring more assets.

  • Chris m

    Fully expect Disney to increase their footprint alright, aka their agenda! An increase of 40% in hip hop commercials on the new foxy news, among plenty of visual kiddie stuff for the pedos. Throat stuffing agendas, transtestes, say my name purple hair dark witch pirate creep shows.

  • iwontell

    DON’T LET THIS HAPPEN………….Imagine Disney getting their hands on Fox since they already have a MAJOR FAKE NEWS NETWORK……….ABC……….and would likely turn Fox into another CNN

    • Pinogam

      Disney – the most deviant of all the Hollywood septic systems. Pretty soon decent, moral people will be taking their television sets to the dump.

    • Roy Beane

      Anything the fake news conglomerates cannot control or overwhelm, they then try to buy out so that they can get control of anything and everything the American public sees and hears over TV and / or other mass media. Very much like the way Hitler and the Nazi Party took over all the media outlets of his time in Germany so as to control everything that the German public saw and heard, thereby gaining eventual control over the public’s THINKING. The goal today is the very SAME for the fake news media in this country.

    • Mr Springfield

      The article said that FOX would keep its news and business news divisions, its broadcast stations and FOX Sports.

      • Legion

        Wish more people would read what the articles actually say before making some “knee-jerk” emotional comment. It’s to the point where they are acting just like the libtards on the left!

        • TwoElks

          This may be due to the fact Americans have been lied to so much, for so long, by so many they no longer believe anything the media says. And…with good reason !

      • No Mas

        You believe Disney would not “influence” the objectives of its news and business news divisions, I tell you its the GOAL of Disney to influence and remove unbiased reporting