Disney pays $52b for Murdoch’s Fox

MEDIA giant Rupert Murdoch says he is excited about the possibilities for his newlook global news and sports powerhouse after striking a bumper deal with The Walt Disney Company.

Disney has agreed to buy key film and television assets from Mr Murdoch’s 21st Century Fox for $US52.4 billion ($68.4 billion).

It ensconces Disney as the world’s biggest filmmaker and hands to the group studios that have produced movies such as Avatar and X-Men, and television shows including The Simpsons and Modern Family.

Disney will pay $US52.4 billion in stock and assume $US13.7 billion of 21st Century Fox’s debt.

Other assets owned by 21st Century Fox will be spun into a separately listed company, to be called Fox.

The company will own assets such as the Fox Broadcasting Network and its stations, Fox News Channel, Fox Business Network, Fox Sports 1, Fox Sports 2 and the Big Ten Network.

It would be a growth company built around news and sport, Mr Murdoch said.

Fox shareholders will get a 25 per cent stake in the larger Disney.

“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 pivotal moment.”

He said the new Fox was “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.”

The Murdochs will continue to lead News Corp, publisher of mastheads including the Mercury, Herald Sun, London’s The Times and The Wall Street Journal.

Some analysts said the deal could be a precursor to an eventual merger of Fox and News Corp assets. News Corp’s publishing and entertainment assets were split in 2013.

Asked by Fox Business whether he was planning a merger, Mr Murdoch said: “I don’t know. Ideally, yes, but I think that’s years away.”

Under the deal, Fox keeps rights to Major League Baseball, the NFL, NASCAR and college sports through the Fox TV network and cable networks FS1, FS2 and Big Ten.

Fox is keeping its studio lot in Los Angeles, which allows it to produce content.

The new company is expected to have annual revenue of about $US10 billion and earnings before interest, taxation and amortisation of about $US2.8 billion.