Merger powerhouse
MEDIA giant Rupert Murdoch will retain control of a growth hungry global news and sport powerhouse after securing a $US66.1 billion deal to sell Fox assets including film studios plus European and Indian television stations to Disney.
It is a deal which also ensconces Disney as the world’s biggest film maker, the company behind Mickey Mouse pays a premium for the studios that have produced movies such as Avatar and X-Men and television shows like Modern Family and The Simpsons.
Disney will pay $52.4 billion in stock and assume $13.7 billion of Fox’s debt.
Disney pays Fox a break fee of $US1.52 billion if it changes its mind, and $US2.5 billion if the deal is blocked by regula- tors, although the White House says President Donald Trump supports the deal and called Mr Murdoch to congratulate him.
Fox would pay Disney $US1.52 billion if it walks away.
The newly named Fox will focus on being a growth company built around news and sport content, Mr Murdoch said.
“I know a lot of you are wondering, ‘Why are the Murdochs making such a momentous decision? Are we retreating?’ Absolutely not,” Mr Murdoch said on a call with analysts.
“We are pivoting at a piv- otal moment.” Mr Murdoch said the new Fox is built on strong foundations.
“It is born out of an important lesson I’ve learned in my long career in media: namely, content and news relevant to viewers will always be valuable. We are excited by the possibilities of the new Fox, which is already a leader many times over.”
The Murdochs will also continue to operate News Corp, the publisher which owns the Geelong Advertiser and Wall Street Journal.
Some analysts say the deal could mean a merger of Fox assets with News Corp, just over four years since entertainment and media assets were split.
Asked by Fox Business whether he plans a merger, Mr Murdoch said: “I don’t know. Ideally, yes, but I think that’s years away. We’ll have to think about that.”
Under the deal, Fox keeps US television networks including Fox News, the number one cable network with 90 million homes across US.
It keeps the Fox Broadcasting Company, Fox Business Network and the Fox Television stations group. Crucially, Fox also holds onto national rights to Major League Baseball, the NFL, NASCAR and college sports through the Fox TV network and cable networks.
Under the deal, Disney will combine with 21st Century Fox’s film production businesses, including Twentieth Century Fox, Fox Searchlight Pictures and Fox 2000.