Comcast Considers Reviving Pursuit of Fox After Higher Bid Was Rejected
12 February 2018 - 12:41PM
Dow Jones News
By Amol Sharma and Shalini Ramachandran
Cable giant Comcast Corp. is contemplating reviving its pursuit
of 21st Century Fox, after its bid for the company's entertainment
assets was turned down despite being over 15% higher than that of
eventual buyer Walt Disney Co., according to people familiar with
the situation.
Disney struck a deal with Fox in December, agreeing to pay $52.4
billion in stock. Fox turned down a Comcast offer that was in the
low-$60 billions range, the people said. The assets on the table in
both offers were essentially the same, including the Twentieth
Century Fox movie and TV studio, international pay TV properties
and some U.S. cable networks.
Fox's primary concern about the Comcast bid was that a tie-up
between the companies would face significant antitrust risks,
people familiar with the discussions said.
A Comcast acquisition of Fox would be a "vertical" deal adding
more cable TV channels to a company that also is a powerhouse in
channel-distribution. The government signaled concerns about
vertical deals when it sued to block AT&T Inc.'s acquisition of
Time Warner Inc., a case that heads to trial next month. Some Wall
Street analysts noted the potential roadblocks in Washington to a
Comcast-Fox deal.
Comcast believed it had offered substantial protections in its
offer against antitrust risk, some of the people familiar with the
situation said.
Fox executives positioned the Disney deal as a chance for its
investors to benefit from Disney's vast content machine and plans
to battle the likes of Netflix Inc. with direct-to-consumer
streaming services. After an asset sale, the remaining "new Fox"
would have properties including the Fox broadcast network, Fox News
and Fox Sports 1.
21st Century Fox Chief Executive James Murdoch, son of Executive
Chairman Rupert Murdoch, may get a position at Disney if the deal
is completed. It is also possible the younger Mr. Murdoch could
strike out on his own.
The Murdoch family controls a 39% voting interest in both 21st
Century Fox and Wall Street Journal-parent News Corp.
A Disney spokeswoman didn't immediately respond to a request for
comment.
Comcast may choose to take no further action. One key
development that could influence its thinking is Fox's release of a
proxy statement on the merger, which would likely indicate the
general process that led up to sealing a deal. It is unclear when
Fox will file its proxy with regulators, ahead of a shareholder
vote on the deal.
Write to Amol Sharma at amol.sharma@wsj.com and Shalini
Ramachandran at shalini.ramachandran@wsj.com
(END) Dow Jones Newswires
February 11, 2018 20:26 ET (01:26 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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