Proposed
Acquisition of 21st Century Fox by Disney
On December 14, 2017, The Walt Disney Company announced a bid to merge with 21st Century Fox for $52.4 billion in stock. Assets being assumed by the merger include the Twentieth Century Fox film and TV studios, Fox Networks Group (along with cable networks such as FX Networks), stakes in National Geographic Partners, Indian satellite TV group Star India, Hulu, UK-based satellite TV group Sky plc, and other key assets. 21st Century Fox will spin-off Fox News, the Fox Business Network, FS1, FS2, Fox Deportes, the Big Ten Network, the Fox Broadcasting Company, Fox Television Stations, and MyNetworkTV into the "New Fox" company.
Comcast (whose division NBCUniversal includes Universal Pictures, DreamWorks Animation, Illumination Entertainment and Universal Parks & Resorts) counter-offered on June 13, 2018, with a $65 billion all cash proposal to acquire the Fox assets that Disney was set to purchase, touching off a major bidding war between the two companies. A week later, Disney counterbid with a $71.3 billion offer. Comcast officially ended its bidding war with Disney to acquire Fox on July 19, in order to focus on acquiring a controlling stake in Sky plc. Disney and Fox shareholders approved the merger between both companies on July 27. If approved by all international regulators, the merger is estimated to be completed in the first half of 2019.
History
2017
On November 6, 2017, CNBC reported that The Walt Disney Company was negotiating a deal with Rupert Murdoch to acquire 21st Century Fox's filmed entertainment, cable entertainment, and direct broadcast satellite divisions, including 20th Century Fox, FX Networks, and National Geographic Partners. The deal would reportedly exclude the Fox Broadcasting Company, 20th Century Fox's studio lot, Fox Television Stations, Fox News, the Fox Business Network, and Fox Sports, which would be spun off into a new independent company run by the Murdoch family.
It would also include film rights to certain franchises, including X-Men and Fantastic Four, and the distribution rights to Star Wars: Episode IV – A New Hope, which are not owned by Disney. Talks had stalled for the day without a deal being finalized, but it was reported on November 10 that the prospected deal had yet to be fully abandoned.
On November 16, 2017, it was reported that Comcast (parent company of NBCUniversal), Verizon Communications, and Sony had also joined Disney in a bidding war for 21st Century Fox. During a recent shareholders meeting, 21st Century Fox co-chairman Lachlan Murdoch stated that Fox was not a "sub-scale" company "finding it difficult to leverage their positions in new and emerging video platforms", but had "the required scale to continue to both execute on our aggressive growth strategy and deliver significant increased returns to shareholders".
Because Disney owns the American Broadcasting Company (ABC), Comcast owns the National Broadcasting Company (NBC), and 21st Century Fox owns the Fox Broadcasting Company, a full acquisition of Fox by either Disney or Comcast would be illegal under the Federal Communications Commission (FCC)'s rules prohibiting a merger between any of the four major broadcast networks.
On November 28, 2017, while mentioning a rumor that the rumored negotiations between Disney and Fox were progressing at a rapid pace, Mike Fleming Jr. of Deadline Hollywood commented that "given how Disney made the Marvel and Lucasfilm deals under the cone of silence, if this happens we'll probably only know it when it's announced. It is certainly being talked about today."
Rumors of a nearing deal continued on December 5, 2017, with additional reports suggesting that the FSN regional sports networks would be included in the sale (assets that would likely be aligned with Disney's ESPN division).
On December 11, 2017, Comcast announced it was dropping its bid on the Fox assets. On December 14, however, Disney and Fox confirmed a $52.4 billion deal to merge the two companies, pending approval from the United States Department of Justice Antitrust Division.
Early
2018
In February, CNBC reported that, despite the Disney-Fox deal, Comcast might take action to outbid Disney's $52.4 billion offer, once the AT&T–Time Warner merger went through. Despite this, Fox president Peter Rice stated he was content with the Disney offer and that the Fox assets were "a great fit for Disney."
Later that month, Comcast made an offer to purchase British broadcast network Sky plc for about $31 billion (£22.1 billion) with £12.50 a share, a move that some analysts speculated could trigger a bidding war between Fox, Disney, and Comcast for Sky.
Early in March, the non-profit group Protect Democracy Project Inc filed a lawsuit against the United States Department of Justice on the hopes to seek any records of communications between the two groups over Disney's pending acquisition of Fox. The lawsuit also sought "any related antitrust enforcement efforts by the DOJ, to find out whether the president or his administration is improperly interfering with the independence of the DOJ out of favoritism for a political ally." Donald Trump congratulated Murdoch for the Disney-Fox deal while attacking AT&T's acquisition of Time Warner, particularly over the ownership of CNN, which he frequently criticized due to alleged bias.
Weeks later, Sky plc entered into a confidentiality agreement with both Fox and Disney to assess and obtain certain antitrust and other regulatory approvals if necessary. The following month, 21st Century Fox made two proposals regarding the Sky acquisition; they would either sell Sky News to Disney (which would be a separate transaction from the Disney-Fox merger) or separate Sky News from Sky plc.
Later that month, the Panel on Takeovers and Mergers ruled that Disney had to acquire all of Sky within 28 days of fully acquiring Fox if the latter's acquisition of Sky is not completed by the time the merger is done, or if Comcast's counter-offer isn't accepted. The same day, Rice revealed that the merger was expected to close by summer 2019.
On April 25, Comcast started a bidding war with Fox for the acquisition of Sky plc. By May, it was reported that Comcast spoke to investment banks about topping Disney's offer to acquire Fox. Shortly afterwards, Bob Iger stated he was willing to drop Sky plc from the deal to ensure the Fox acquisition.
Several Fox investors said that they would be open to terminate the company's agreement with Disney if Comcast followed through on its plan to launch a rival all-cash bid for $60 billion. Murdoch's family trust controlled 39% of Fox due to shares it held with special voting rights. However, under the company's by-law, those special rights did not apply to a vote on the Disney/Fox deal when the Murdoch trust only controlled 17% of the vote, making it easier for other shareholders to defeat him, which was expected as early as next month. Days later, it was confirmed that Lachlan Murdoch, rather than James Murdoch, would take charge of the New Fox company.
The following week, Comcast publicly announced it was looking into making an all-cash counter-offer for the Fox assets that Disney proposed to acquire. Shortly after, it was reported that Disney was looking into making its own all-cash counter-offer for Fox assets if Comcast went through with their offer.
The next day, Disney and Fox announced they had set their shareholder vote meetings for July 10, although both stated that Fox's meeting could be postponed if Comcast came through with their offer.
Mid-2018
On June 12, AT&T was given approval by District Judge Richard J. Leon to acquire Time Warner, easing concerns Comcast had regarding whether government regulators would block their bid for Fox. Consequently, the next day, Comcast mounted a bid of $65 billion for the 21st Century Fox assets that were set to be acquired by Disney.
On June 14, 2018, Bloomberg News reported that the Yankees were seeking to invoke a clause in Fox's purchase of stakes in YES Network, allowing them to buy back Fox's stake in the event of a change in ownership (and thus prevent it from being included in the sale).
On June 18, 2018, it was reported that Disney will add to its already existing $52 billion claim to contest Comcast's proposed counter-offer for the Fox assets.
On June 19, 2018, it was reported that Disney has agreed to acquire Sky News from Sky itself.
On June 20, 2018, Disney and Fox announced that they had amended their previous merger agreement, upping Disney’s offer to $71.3 billion (a 10% premium over Comcast's $65 billion offer), while also offering shareholders the option of receiving cash instead of stock. On June 21, 2018, Murdoch said in response to Disney's higher 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." That still does not prevent other companies from making a bid, as the deal was needed to be voted on by shareholders.
Iger explained the reasoning behind the bid: "Direct-to-consumer distribution has actually become an even more compelling proposition in the six months since we announced the deal. There has just been not only a tremendous amount of development in that space, but clearly the consumer is voting—loudly."
On June 27, 2018, the United States Department of Justice gave antitrust approval to Disney under the condition of selling Fox's 22 regional sports channels, to which the company has agreed to. The next day, Disney and Fox boards scheduled July 27, 2018 as the day shareholders vote on Fox's properties being sold to Disney.
On July 9, 2018, a Fox shareholder filed a lawsuit to stop the acquisition from Disney citing the absence of financial projections for Hulu. On the same day, CNBC reported that Comcast was looking for companies that could take over Fox's Regional Sports Networks. This would make easier Comcast's legislative problems regarding the takeover of Fox assets, preparing to make a new all cash counter-offer before July 27, 2018.
On July 11, 2018, 21st Century Fox raised its bid to purchase Sky's assets to $32.5 billion, and $18.57 a share. In response, Comcast increased its bid to $34 billion, and $19.5 a share. At the same time, Fox was given clearance by the British government to purchase Sky. The bidding war for Sky led to some analysts speculating that Comcast could give up bidding for 21st Century Fox in favor of a smaller battle.
On July 12, 2018, the Department of Justice filed a notice of appeal with the D.C. Circuit to reverse the District Court's approval for AT&T acquisition of Time Warner (now WarnerMedia). Although analysts say that the chances of the DOJ win are small, they say it is the "final nail in the coffin for Comcast's Fox chase. This is a clear gift to Disney." On the next day, CEO of AT&T Randall Stephenson gave an interview with CNBC, about Comcast's bid for Fox: "It probably can't help it. You're in a situation where two entities are bidding for an asset, and this kind of action can obviously influence the outcome of those actions."
On July 13, 2018, Disney received the support of the Institutional Shareholder Services and Glass Lewis, the two most prominent proxy adviser firms in the world. Fox shareholders were recommended by the advisers as means to provide for Disney's future. Also on that same day, British regulators have decided that if Disney purchases Fox's assets before Sky's purchase from either Fox or Comcast, it will be forced to launch a bid for the full ownership of Sky, at a minimum of $18.6 a share.
On July 16, 2018, CNBC reported that Comcast was unlikely to continue its bidding war with Disney to acquire Fox. Instead, Comcast is likely to continue pursuing 61% stake of Sky. On July 18, 2018, Bloomberg reported that the Sky board also scheduled July 27, 2018 as the day shareholders vote on selling Sky properties. On July 19, 2018, Comcast officially announced that it was dropping its bid on the Fox assets in order to focus on its bid for Sky. The CEO of Comcast, Brian L. Roberts, said "I'd like to congratulate Bob Iger and the team at Disney and commend the Murdoch family and Fox for creating such a desirable and respected company."
On July 25, 2018, TCI Fund Management, the second largest shareholder of 21st Century Fox, indicated that they voted to approve the Disney-Fox deal. On July 27, 2018, Disney and Fox shareholders approved the merger between the two companies. The merger's completions should be in the first half of 2019. On the same day, Bloomberg reported that out of all 15 nations yet to approve the deal,China
On December 14, 2017, The Walt Disney Company announced a bid to merge with 21st Century Fox for $52.4 billion in stock. Assets being assumed by the merger include the Twentieth Century Fox film and TV studios, Fox Networks Group (along with cable networks such as FX Networks), stakes in National Geographic Partners, Indian satellite TV group Star India, Hulu, UK-based satellite TV group Sky plc, and other key assets. 21st Century Fox will spin-off Fox News, the Fox Business Network, FS1, FS2, Fox Deportes, the Big Ten Network, the Fox Broadcasting Company, Fox Television Stations, and MyNetworkTV into the "New Fox" company.
Comcast (whose division NBCUniversal includes Universal Pictures, DreamWorks Animation, Illumination Entertainment and Universal Parks & Resorts) counter-offered on June 13, 2018, with a $65 billion all cash proposal to acquire the Fox assets that Disney was set to purchase, touching off a major bidding war between the two companies. A week later, Disney counterbid with a $71.3 billion offer. Comcast officially ended its bidding war with Disney to acquire Fox on July 19, in order to focus on acquiring a controlling stake in Sky plc. Disney and Fox shareholders approved the merger between both companies on July 27. If approved by all international regulators, the merger is estimated to be completed in the first half of 2019.
History
2017
On November 6, 2017, CNBC reported that The Walt Disney Company was negotiating a deal with Rupert Murdoch to acquire 21st Century Fox's filmed entertainment, cable entertainment, and direct broadcast satellite divisions, including 20th Century Fox, FX Networks, and National Geographic Partners. The deal would reportedly exclude the Fox Broadcasting Company, 20th Century Fox's studio lot, Fox Television Stations, Fox News, the Fox Business Network, and Fox Sports, which would be spun off into a new independent company run by the Murdoch family.
It would also include film rights to certain franchises, including X-Men and Fantastic Four, and the distribution rights to Star Wars: Episode IV – A New Hope, which are not owned by Disney. Talks had stalled for the day without a deal being finalized, but it was reported on November 10 that the prospected deal had yet to be fully abandoned.
On November 16, 2017, it was reported that Comcast (parent company of NBCUniversal), Verizon Communications, and Sony had also joined Disney in a bidding war for 21st Century Fox. During a recent shareholders meeting, 21st Century Fox co-chairman Lachlan Murdoch stated that Fox was not a "sub-scale" company "finding it difficult to leverage their positions in new and emerging video platforms", but had "the required scale to continue to both execute on our aggressive growth strategy and deliver significant increased returns to shareholders".
Because Disney owns the American Broadcasting Company (ABC), Comcast owns the National Broadcasting Company (NBC), and 21st Century Fox owns the Fox Broadcasting Company, a full acquisition of Fox by either Disney or Comcast would be illegal under the Federal Communications Commission (FCC)'s rules prohibiting a merger between any of the four major broadcast networks.
On November 28, 2017, while mentioning a rumor that the rumored negotiations between Disney and Fox were progressing at a rapid pace, Mike Fleming Jr. of Deadline Hollywood commented that "given how Disney made the Marvel and Lucasfilm deals under the cone of silence, if this happens we'll probably only know it when it's announced. It is certainly being talked about today."
Rumors of a nearing deal continued on December 5, 2017, with additional reports suggesting that the FSN regional sports networks would be included in the sale (assets that would likely be aligned with Disney's ESPN division).
On December 11, 2017, Comcast announced it was dropping its bid on the Fox assets. On December 14, however, Disney and Fox confirmed a $52.4 billion deal to merge the two companies, pending approval from the United States Department of Justice Antitrust Division.
Early
2018
In February, CNBC reported that, despite the Disney-Fox deal, Comcast might take action to outbid Disney's $52.4 billion offer, once the AT&T–Time Warner merger went through. Despite this, Fox president Peter Rice stated he was content with the Disney offer and that the Fox assets were "a great fit for Disney."
Later that month, Comcast made an offer to purchase British broadcast network Sky plc for about $31 billion (£22.1 billion) with £12.50 a share, a move that some analysts speculated could trigger a bidding war between Fox, Disney, and Comcast for Sky.
Early in March, the non-profit group Protect Democracy Project Inc filed a lawsuit against the United States Department of Justice on the hopes to seek any records of communications between the two groups over Disney's pending acquisition of Fox. The lawsuit also sought "any related antitrust enforcement efforts by the DOJ, to find out whether the president or his administration is improperly interfering with the independence of the DOJ out of favoritism for a political ally." Donald Trump congratulated Murdoch for the Disney-Fox deal while attacking AT&T's acquisition of Time Warner, particularly over the ownership of CNN, which he frequently criticized due to alleged bias.
Weeks later, Sky plc entered into a confidentiality agreement with both Fox and Disney to assess and obtain certain antitrust and other regulatory approvals if necessary. The following month, 21st Century Fox made two proposals regarding the Sky acquisition; they would either sell Sky News to Disney (which would be a separate transaction from the Disney-Fox merger) or separate Sky News from Sky plc.
Later that month, the Panel on Takeovers and Mergers ruled that Disney had to acquire all of Sky within 28 days of fully acquiring Fox if the latter's acquisition of Sky is not completed by the time the merger is done, or if Comcast's counter-offer isn't accepted. The same day, Rice revealed that the merger was expected to close by summer 2019.
On April 25, Comcast started a bidding war with Fox for the acquisition of Sky plc. By May, it was reported that Comcast spoke to investment banks about topping Disney's offer to acquire Fox. Shortly afterwards, Bob Iger stated he was willing to drop Sky plc from the deal to ensure the Fox acquisition.
Several Fox investors said that they would be open to terminate the company's agreement with Disney if Comcast followed through on its plan to launch a rival all-cash bid for $60 billion. Murdoch's family trust controlled 39% of Fox due to shares it held with special voting rights. However, under the company's by-law, those special rights did not apply to a vote on the Disney/Fox deal when the Murdoch trust only controlled 17% of the vote, making it easier for other shareholders to defeat him, which was expected as early as next month. Days later, it was confirmed that Lachlan Murdoch, rather than James Murdoch, would take charge of the New Fox company.
The following week, Comcast publicly announced it was looking into making an all-cash counter-offer for the Fox assets that Disney proposed to acquire. Shortly after, it was reported that Disney was looking into making its own all-cash counter-offer for Fox assets if Comcast went through with their offer.
The next day, Disney and Fox announced they had set their shareholder vote meetings for July 10, although both stated that Fox's meeting could be postponed if Comcast came through with their offer.
Mid-2018
On June 12, AT&T was given approval by District Judge Richard J. Leon to acquire Time Warner, easing concerns Comcast had regarding whether government regulators would block their bid for Fox. Consequently, the next day, Comcast mounted a bid of $65 billion for the 21st Century Fox assets that were set to be acquired by Disney.
On June 14, 2018, Bloomberg News reported that the Yankees were seeking to invoke a clause in Fox's purchase of stakes in YES Network, allowing them to buy back Fox's stake in the event of a change in ownership (and thus prevent it from being included in the sale).
On June 18, 2018, it was reported that Disney will add to its already existing $52 billion claim to contest Comcast's proposed counter-offer for the Fox assets.
On June 19, 2018, it was reported that Disney has agreed to acquire Sky News from Sky itself.
On June 20, 2018, Disney and Fox announced that they had amended their previous merger agreement, upping Disney’s offer to $71.3 billion (a 10% premium over Comcast's $65 billion offer), while also offering shareholders the option of receiving cash instead of stock. On June 21, 2018, Murdoch said in response to Disney's higher 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." That still does not prevent other companies from making a bid, as the deal was needed to be voted on by shareholders.
Iger explained the reasoning behind the bid: "Direct-to-consumer distribution has actually become an even more compelling proposition in the six months since we announced the deal. There has just been not only a tremendous amount of development in that space, but clearly the consumer is voting—loudly."
On June 27, 2018, the United States Department of Justice gave antitrust approval to Disney under the condition of selling Fox's 22 regional sports channels, to which the company has agreed to. The next day, Disney and Fox boards scheduled July 27, 2018 as the day shareholders vote on Fox's properties being sold to Disney.
On July 9, 2018, a Fox shareholder filed a lawsuit to stop the acquisition from Disney citing the absence of financial projections for Hulu. On the same day, CNBC reported that Comcast was looking for companies that could take over Fox's Regional Sports Networks. This would make easier Comcast's legislative problems regarding the takeover of Fox assets, preparing to make a new all cash counter-offer before July 27, 2018.
On July 11, 2018, 21st Century Fox raised its bid to purchase Sky's assets to $32.5 billion, and $18.57 a share. In response, Comcast increased its bid to $34 billion, and $19.5 a share. At the same time, Fox was given clearance by the British government to purchase Sky. The bidding war for Sky led to some analysts speculating that Comcast could give up bidding for 21st Century Fox in favor of a smaller battle.
On July 12, 2018, the Department of Justice filed a notice of appeal with the D.C. Circuit to reverse the District Court's approval for AT&T acquisition of Time Warner (now WarnerMedia). Although analysts say that the chances of the DOJ win are small, they say it is the "final nail in the coffin for Comcast's Fox chase. This is a clear gift to Disney." On the next day, CEO of AT&T Randall Stephenson gave an interview with CNBC, about Comcast's bid for Fox: "It probably can't help it. You're in a situation where two entities are bidding for an asset, and this kind of action can obviously influence the outcome of those actions."
On July 13, 2018, Disney received the support of the Institutional Shareholder Services and Glass Lewis, the two most prominent proxy adviser firms in the world. Fox shareholders were recommended by the advisers as means to provide for Disney's future. Also on that same day, British regulators have decided that if Disney purchases Fox's assets before Sky's purchase from either Fox or Comcast, it will be forced to launch a bid for the full ownership of Sky, at a minimum of $18.6 a share.
On July 16, 2018, CNBC reported that Comcast was unlikely to continue its bidding war with Disney to acquire Fox. Instead, Comcast is likely to continue pursuing 61% stake of Sky. On July 18, 2018, Bloomberg reported that the Sky board also scheduled July 27, 2018 as the day shareholders vote on selling Sky properties. On July 19, 2018, Comcast officially announced that it was dropping its bid on the Fox assets in order to focus on its bid for Sky. The CEO of Comcast, Brian L. Roberts, said "I'd like to congratulate Bob Iger and the team at Disney and commend the Murdoch family and Fox for creating such a desirable and respected company."
On July 25, 2018, TCI Fund Management, the second largest shareholder of 21st Century Fox, indicated that they voted to approve the Disney-Fox deal. On July 27, 2018, Disney and Fox shareholders approved the merger between the two companies. The merger's completions should be in the first half of 2019. On the same day, Bloomberg reported that out of all 15 nations yet to approve the deal,
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