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Walt Disney raises bid for Fox assets to $71.3 billion, tops Comcast

20 June 2018
Walt Disney raises bid for Fox assets to $71.3 billion, tops Comcast

Disney said it would now pay $38 per share for Fox, up from its initial bid of $28 per share. Even though a federal judge resoundingly defeated the government's lawsuit seeking to block the vertical merger of AT&T and Time Warner, the Disney CEO said he still believes a more vertical blend of Comcast (whose holdings include the No. 1 US cable system) and Fox would face scrutiny.

Deadline reports most analysts and industry observers had expected Disney to match Comcast, but not go so much higher.

Disney chairman and chief executive Robert Iger said the acquisition of the 20th Century Fox studios and television assets in the United States and overseas would better position his company to compete in a media landscape being disrupted by big technology players. The acquisition will occur immediately after the spin-off by 21st Century Fox of the Fox Broadcasting network and stations, Fox News Channel, Fox Business Network, FS1, FS2 and Big Ten Network into a newly listed company referred to as New Fox.

The deal became possible when Murdoch, 87, and his sons made a decision to slim down their media-entertainment empire, leaving them with the Fox News Channel, the Fox broadcast network and sports cable operations. The deal would be about 50% cash and 50% stock, and debt would be used to partly finance the transaction.

Disney's new offer is 36 higher than the one it reached with Fox in December. The previous agreement was an all-stock deal, and Comcast's cash offer was seen as a significant enticement.

Disney's new offer gives Fox shareholders the option to take their payment in the form of cash or stock, up to a 50-50 level. The bidding war comes after AT&T bought Time Warner for $81 billion, after a federal judge rejected the government's antitrust concerns.

Fox said it will postpone its special shareholders meeting in order to provide stockholders with an opportunity to evaluate Disney's amended offer.

You can read the full Disney press release HERE and the FOX press release HERE.

Mr Murdoch, whose family trust has an economic interest of 16.6% in Fox, stunned the media industry when, just before Christmas a year ago, he agreed to sell most of the company to Disney in a deal that would represent the biggest shake-up in Hollywood since the 1930s - bringing together respectively the fourth and second largest movie studios in Tinseltown.