The Walt Disney Company / 21st Century Fox Deal Imperiled from Comcast's Bid

10 May, 2018, 00:31 | Author: Eloise Houston
  • The NBC and Comcast logo are displayed on top of 30 Rockefeller Plaza formerly known as the GE building in midtown Manhattan in New York

Yesterday, it was reported that Comcast was eyeing a brand new cash bid in an attempt to acquire 21st Century Fox for $60 billion - topping The Walt Disney Company's announced $52.4 billion deal.

Some of the leading companies and disruptors in movies and television, like Netflix and Amazon, have introduced a new vertical business model that Comcast and Disney are desperate to acquire for themselves - the ability to create and delivery their products directly to the consumer.

One concern raised from the Fox side during the last round of deliberations was the relative value of Comcast shares versus Disney shares, so an all-cash bid would take that off the table, the person said.

Before the Disney deal was reached, Comcast had submitted an offer for the Fox assets that was 16% higher, but Fox turned it down partly over fears that it wouldn't pass muster with antitrust regulators, according to a regulatory filing last month and people familiar with the situation.

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Comcast, who initially cited sturdy stock as a reason for 21st Century Fox to accept their deal instead of The Walt Disney Company's, has seen shares fall about 15 percent since Disney announced their bid for Fox. The 21st Century Fox intellectual property would add to the exclusive content on that video streaming service. These two businessmen do not like each other. A similar deal underway involving Time Warner and AT&T is now under deliberation by the United States government.

John Nallen, now the chief financial officer of 21st Century Fox, is expected to become the chief operating officer of the so-called New Fox, the people said. Comcast believes in the judge's favorable ruling and are planning ahead by approaching investment banks in anticipation of that judgement.

Comcast is considering making a play to break up that deal, and has lined up around $60 billion in financing to make an all-cash offer for the Fox assets, the people say. The Walt Disney Company has a large financial resources at their disposal.

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