Com­cast tops Dis­ney $65bn of­fer for Fox

NEW ROUND OF BID­DING FOR PRIZED AS­SET

The Nation - - BUSINESS -

COM­CAST has of­fered $65 bil­lion (Bt2 tril­lion) for key film and tele­vi­sion as­sets of Ru­pert Mur­doch’s 21st Cen­tury Fox, top­ping an of­fer from Walt Dis­ney Co for a deal that could cre­ate a dom­i­nant me­dia-en­ter­tain­ment power.

The move by Com­cast, which is the largest US cable provider and also owns the NBCUniver­sal me­dia group, opens up a new round of com­pe­ti­tion for the prized as­sets be­ing shed by the Mur­doch fam­ily em­pire.

The deal, if ap­proved, would merge Com­cast-owned Univer­sal Stu­dios and the NBC tele­vi­sion net­work with Hol­ly­wood ri­val 20th Cen­tury Fox, Fox’s cable en­ter­tain­ment net­works and in­ter­na­tional TV busi­nesses.

“These are highly strate­gic and com­ple­men­tary busi­nesses and we are in our minds the right buyer,” said Com­cast chair­man and chief ex­ec­u­tive Brian Roberts.

Roberts said Mur­doch had built “one of the world’s great me­dia and en­ter­tain­ment com­pa­nies,” and that its his­tory is sim­i­lar to that of Com­cast’s.

With the deal, Roberts said Com­cast would stay on track “to build the en­ter­tain­ment com­pany of the fu­ture.”

Roberts said the all-cash bid is nearly 20 per cent richer than the $52 bil­lion stock of­fer from Dis­ney, and said Com­cast would match the Dis­ney of­fer of a $2.5 bil­lion fee if the deal fails to win reg­u­la­tory ap­proval.

“We are highly con­fi­dent in our abil­ity to fi­nance the trans­ac­tion, and our of­fer in­cludes no fi­nanc­ing-re­lated con­di­tions,” Com­cast said in a let­ter to Ru­pert Mur­doch and his sons Lach­lan and James.

The state­ment pointed out that Com­cast and Fox had been in talks be­fore the Mur­dochs reached the deal with Dis­ney, which is be­ing sub­mit­ted for a share­holder vote on July 10.

The new of­fer is likely to prompt a re­sponse from Dis­ney, and force the Mur­dochs to re­view their po­si­tion on the tie-up with Dis­ney, which owns the ABC tele­vi­sion net­works ESPN and is a ma­jor Hol­ly­wood player.

The news comes a day af­ter a fed­eral judge ap­proved a mas­sive $85 bil­lion takeover by tele­com-broad­band gi­ant AT&T or me­dia-en­ter­tain­ment con­glom­er­ate Time Warner that could re­shape the me­dia and com­mu­ni­ca­tions land­scape.

‘In­ter­na­tional ap­provals’

The court ap­proval ended a heated an­titrust bat­tle, and sug­gested Com­cast would be able to clear any reg­u­la­tory hur­dles to a deal with Fox.

Com­cast said any an­titrust con­cerns should be eased by the court rul­ing on AT&T and that its of­fer “should be as or more likely to re­ceive in­ter­na­tional ap­provals, given our rel­a­tively small pres­ence out­side the US”.

“We be­lieve yes­ter­day’s de­ci­sion in the AT&T case sup­ports our con­fi­dence,” Com­cast chief fi­nan­cial of­fi­cer Mike Ca­vanagh said on the con­fer­ence call.

The deal be­came pos­si­ble when Ru­pert Mur­doch, 87, and his sons de­cided to slim down the me­dia em­pire, leav­ing them with a “New Fox” that in­cludes the Fox News Chan­nel, the Fox broad­cast net­work and sports cable oper­a­tions.

Com­cast if suc­cess­ful would be able to ex­pand be­yond US bor­ders to new mar­kets in Europe and In­dia.

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