Disney ups ante, raises bid for Fox to $70.4B

Deal a blow to Comcast, which had offered $65B

The battle between the Walt Disney Co. and Comcast for a collection of assets being sold by 21st Century Fox has escalated to the next level.

Disney on Wednesday raised its bid to $38 per Fox share in cash and stock, or about $70.4 billion, surpassing its original $52.4 billion overture made in December 2017.

Last week, Comcast joined the fray with an offer of $65 billion, about a 20 percent premium to Disney’s original bid, after a federal judge approved AT&T’s $85 billion acquisition of Time Warner. That decision sent a signal to media companies that regulators might look more favorably on consolidation of film and TV content by media companies also in the business of distributing content and providing broadband connections.

Fox is looking to sell many of its assets, including its TV and movie studios, channels FX and National Geographic and its 22 regional sports networks, to refocus the company on news and sports programming.

After Disney delivered its new offer, Fox executive chairman Rupert Murdoch – who along with sons Lachlan and James control Fox – said in a statement: “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.”

Wall Street analysts expect a heated bidding war between Comcast and Disney for Fox’s assets, which include Fox’s 30 percent share of streaming service Hulu and 39 percent stake in U.K.-based pay-TV and broadband provider Sky.

Fox’s movies and TV content – films such as “Avatar” and series such as “The Simpsons” – are vital to Disney, too. CEO Robert Iger has said Fox’s portfolio would enhance Disney’s planned subscription video service, expected to begin streaming in 2019.

Speaking Wednesday after Disney upped its offer, Iger said the acquisition would transform Disney into “a truly global entertainment company.”

The addition of Fox’s TV and movie studios, as well as channels such as FX and National Geographic, “will allow us to … deliver more exciting and personalized entertainment experiences to meet the growing demands of consumers worldwide,” he said.

Iger also said a Disney-Fox deal has a better chance of passing regulatory muster than a Comcast-Fox deal and cautioned those who thought the judge’s decision in the AT&T-Time Warner merger set the stage for an M&A free-for-all.

Fox has scheduled a July 10 shareholder meeting to vote on Disney’s merger.

Disney CEO Robert Iger said the acquisition of Fox assets would transform Disney into “a truly global entertainment company.”

DISNEYLAND