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Comcast bids $65 billion for 21st Century Fox assets, topping Disney

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Comcast bids $65 billion for 21st Century Fox assets, topping Disney

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Old 06-14-2018, 01:48 AM
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Default Comcast bids $65 billion for 21st Century Fox assets, topping Disney

Comcast bids $65 billion for 21st Century Fox assets, topping Disney

> Comcast, the parent of CNBC, offered Fox shareholders $35 a share in cash and 100 percent of the shares the company left behind after the deal.
> The deal is a 19 percent premium to the value of Disney's offer as of noon on Wednesday.
> The announcement comes one day after a federal judge cleared the way for AT&T's megadeal for Time Warner, a decision that is expected to unleash a wave of big mergers.

Alex Sherman | Liz Moyer

Comcast officially bids $65B for Fox assets

Comcast announced a $65 billion bid for Twenty-First Century Fox units that are currently in an agreement to be acquired by Disney.

The bid, announced Wednesday, represents a 19 percent premium to Disney's offer. Comcast, the parent of CNBC, offered $35 a share in cash.

Disney agreed in December to buy the majority of Fox for $52.4 billion in stock. The deal included Fox's movie studios, networks National Geographic and FX, Star TV, and stakes in Sky, Endemol Shine Group and Hulu, as well as regional sports networks.

The assets would increase Comcast's international footprint and boost its entertainment portfolio at a time when it's facing pressure in its video business as more consumers cut the cord and turn to internet-delivered video services like Netflix.

"These are highly strategic and complementary businesses, and we are in our minds the right buyer," Comcast's CEO Brian Roberts said on a call with investors.

In a letter to Fox's board and members of the Murdoch family released earlier, Roberts said, "We were disappointed when [Fox] decided to enter into a transaction with The Walt Disney
Company, even though we had offered a meaningfully higher price." He went on to say, "We are pleased to present a new, all-cash proposal that fully addresses the Board's stated concerns with our prior proposal."

Comcast is planning for an increased bid from Disney that may include a cash component, according to people familiar with the matter. Comcast believes it is better suited to offer cash because the market allows for a higher leverage ratio from a cable company with strong cash flows than a media company like Disney, which is accustomed to carrying lower leverage ratios, the people said. A Disney bid with cash will also diminish the tax benefits for the Murdoch family, which controls Fox.

AT&T approval cleared the way
The long-awaited bid comes a day after a federal judge cleared AT&T's $85 billion takeover of Time Warner, a deal the government had tried to block on competition grounds. AT&T's win in the court case is expected to usher in a wave of big mergers as companies look for new ways to combine.

Comcast feels confident of its chances to get a deal passed by U.S. regulators after AT&T's deal was approved yesterday, according to people familiar with the matter. Comcast is willing to divest Fox's regional sports networks and even Fox's portion of Hulu, if necessary, the people said. While Comcast would like to keep the Fox stake in Hulu if possible, and thinks it should be able to, it would consider dropping down closer to 50 percent if necessary, one of the people said. Comcast, Fox and Disney all own 30 percent of Hulu. Time Warner owns the other 10 percent.

Asked about Hulu on the investor call, NBCUniversal CEO Steve Burke said, "We think that's a very important part of this deal," adding that Comcast would be interested in investing in and growing the streaming service in the future.

Comcast also pledged to offer the same $2.5 billion reverse termination fee Disney already agreed to and has offered to reimburse the $1.525 billion break-up fee that Disney would have to pay if it doesn't complete its deal.

In the media world, cable and telecommunications giants like Comcast are looking to add capabilities in creating the content they distribute across their networks. Viacom and CBS have also been dancing around a deal that would marry cable networks and the Paramount Pictures film studio with CBS's networks and local television stations.

...
https://www.cnbc.com/2018/06/13/comc...ox-assets.html
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Old 06-14-2018, 02:33 AM
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I don't see The Mouse just laying over and taking it on this one....
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Old 06-14-2018, 05:19 AM
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It’s a cash deal however, which makes it weak.....
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Old 06-14-2018, 07:31 AM
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Originally Posted by owebo View Post
It’s a cash deal however, which makes it weak.....
How is offering cash vs a stock swap considered a weak proposition? The question is does Comcast really have a $65 billion pile of cash lying around or are they planning on issuing debt.
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Old 06-14-2018, 07:55 AM
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The ATT decision will likely indicate a trend towards M&A including such cash rich companies as Apple and Netflix.

Interesting, however, as DOJ has indicated they're still not done with this yet.
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Old 06-20-2018, 03:02 PM
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Originally Posted by Over9K View Post
I don't see The Mouse just laying over and taking it on this one....


That didn't take long...



Originally Posted by Variety

Disney Ups Fox Bid to $71.3 Billion, Outflanking Comcast

The Walt Disney Company has boosted its bid to acquire the bulk of 21st Century Fox, raising its offer to $71.3 billion in cash and stock. In a statement, Fox said Wednesday that the new deal is significantly better than Disney’s earlier offer and “is superior to the proposal made by the Comcast Corporation.”

The move comes after Comcast launched a rival bid for most of Fox’s film and television holdings. Its $65 billion all-cash offer topped the $52.4 billion deal that Disney inked with Fox in December, fueling expectations of a bidding war between two of the world’s biggest media companies. Both Disney and Comcast see a Fox acquisition as potentially transformative, adding to their arsenal of hit movies and shows at a time when digital behemoths such as Netflix and Amazon are changing the way consumers watch and pay for content.

Disney said it would now pay $38 per share for Fox, up from its initial bid of $28 per share. The deal would be about 50% cash and 50% stock, and debt would be used to partly finance the transaction.

Despite the sweetened offer, Fox’s board said it retained the right to weigh competing bids. Comcast, which had proposed to pay $35 per share, declined to comment on Disney’s freshened offer.

“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,” said Rupert Murdoch, executive chairman of 21st Century Fox. “We remain convinced that the combination of 21CF’s iconic assets, brands and franchises with Disney’s will create one of the greatest, most innovative companies in the world.”

As part of the deal, Disney would acquire 20th Century Fox, Fox’s film studio, as well as a cable group that includes FX Networks, National Geographic and several international channels and regional sports networks. Also included is Fox’s 30% stake in Hulu and 39% interest in European satellite broadcaster Sky.

Fox would retain some assets, including Fox News and Fox Broadcasting Company, and regroup them in a new standalone company run by Murdoch and his son Lachlan.

“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,” Disney chief Bob Iger said in a statement. “At a time of dynamic change in the entertainment industry, the combination of Disney’s and Fox’s unparalleled collection of businesses and franchises will allow us to create more appealing high-quality content, expand our direct-to-consumer offerings and international presence, and deliver more personalized and compelling entertainment experiences to meet growing consumer demand around the world.”

The battle for Fox has transfixed the media industry, pitting Iger against Comcast head Brian Roberts, with control of one of Hollywood’s most storied film and television brands in the balance.

Fox’s share price was up 5% in the immediate aftermath of the announcement, while Comcast shares fell 0.5%. Fox has postponed a July 10 meeting, which had originally been scheduled for shareholders to vote on the deal.
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Old 06-20-2018, 03:08 PM
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Originally Posted by Over9K View Post
I don't see The Mouse just laying over and taking it on this one....
Nope.
Originally Posted by Over9K View Post
That didn't take long...
IMO, they want to acquire the Marvel licenses that Fox has, and they're also wanting to better position themselves with a streaming network of their own. What better way to than to get a controlling interest in an already good streaming service, Hulu.
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Old 06-20-2018, 03:19 PM
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Originally Posted by GhostTX View Post
Nope.

IMO, they want to acquire the Marvel licenses that Fox has, and they're also wanting to better position themselves with a streaming network of their own. What better way to than to get a controlling interest in an already good streaming service, Hulu.
This is 70% about streaming, 20% about eliminating the opportunity for their competition to gain an advantage, and 10% about the IP they would gain in the deal, of which the Marvel stuff is of the least importance. The only people that care if the friggin' X-Men and Fantastic Four are in the MCU are nerds. This is about Disney's next evolutionary phase as an entertainment conglomerate, not about X-Men Vs Avengers...
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Old 06-20-2018, 03:29 PM
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Originally Posted by Over9K View Post
This is 70% about streaming, 20% about eliminating the opportunity for their competition to gain an advantage, and 10% about the IP they would gain in the deal, of which the Marvel stuff is of the least importance. The only people that care if the friggin' X-Men and Fantastic Four are in the MCU are nerds. This is about Disney's next evolutionary phase as an entertainment conglomerate, not about X-Men Vs Avengers...
Couldn't agree more but I still would like X-Men and the Fantastic Four as part of the MCU
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Old 06-20-2018, 03:41 PM
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Originally Posted by grady View Post
Couldn't agree more but I still would like X-Men and the Fantastic Four as part of the MCU
Oh, I want the Fox Marvel characters back at Marvel Studios too... its just not the priority in the deal for the company. Can you imagine Bob Iger being like 'Get me Wolverine, the Silver Surfer and REED ******' RICHARDS!"
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Old 06-20-2018, 03:55 PM
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Originally Posted by 69L46 View Post
The ATT decision will likely indicate a trend towards M&A including such cash rich companies as Apple and Netflix.

Interesting, however, as DOJ has indicated they're still not done with this yet.
I see this getting hung up.
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Old 06-20-2018, 04:34 PM
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Originally Posted by Over9K View Post
This is 70% about streaming, 20% about eliminating the opportunity for their competition to gain an advantage, and 10% about the IP they would gain in the deal, of which the Marvel stuff is of the least importance. The only people that care if the friggin' X-Men and Fantastic Four are in the MCU are nerds. This is about Disney's next evolutionary phase as an entertainment conglomerate, not about X-Men Vs Avengers...
Seeing how the Star Wars aren't doing as well as one would hope, and MCU stuff is rocking the movie world, I don't see why IP is not a larger portion of your ratios. Add X-Men numbers to the MCU, and that beats Star Wars hands down:
https://www.the-numbers.com/movies/f...ses/sort/World


Last edited by GhostTX; 06-20-2018 at 04:36 PM.
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Old 06-20-2018, 10:13 PM
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Originally Posted by GhostTX View Post
Seeing how the Star Wars aren't doing as well as one would hope, and MCU stuff is rocking the movie world, I don't see why IP is not a larger portion of your ratios. Add X-Men numbers to the MCU, and that beats Star Wars hands down:
https://www.the-numbers.com/movies/f...ses/sort/World

The IP is inconsequential, really, in terms of business deal on this scale. In the larger scheme of things, it doesn't matter if Disney has the Fox catalog of characters for the Marvel Universe. Yes, the IP is an asset to be bought, but it is not the reason or priority for making a $71.B bid... it's the icing that comes after the fact.

What Disney is buying when they buy Fox is a greater share in the right-now world of Streaming, and a better spot in the current standings in the race to be second place to Netflix.

I'm very much with you on the idea that Disney having these characters would be amazing for both their bottom line and the enjoyment of the fans, but it's not the driving force in Disney's acquisition.
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