The Atlanta Journal-Constitution
Disney to pay $52.4B for most of 21st Century Fox
NEW YORK — Disney is buying the Murdoch family’s Fox movie and television studios and some cable and international TV businesses for about $52.4 billion, as the home of Mickey Mouse tries to meet competition from technology companies in the entertainment business.
Disney’s all-stock deal for 21st Century Fox gives it the studios that produce the Avatar movies, “The Simpsons” and “Modern Family,” though Murdoch will form a new company to keep the U.S. television networks, including Fox News Channel, Fox Business Network and Fox Broadcasting. “The Simpsons” will continue to air on Murdoch’s Fox stations. The deal also brings Marvel characters such as X-Men and The Avengers under one roof — Disney’s.
Murdoch’s new company will get national rights to Major League Baseball, the NFL, NASCAR and college sports through the Fox TV network and cable networks FS1, FS2 and Big Ten Network. Disney is getting Fox’s regional sports networks.
In owning these properties, Disney will be in a better position to compete with the likes of Netflix when it launches ESPN- and Disney-branded streaming services in the coming years.
Rupert Murdoch , who built a global media and entertainment empire out of an inheritance from his father in Australia, said what remains of his family’s business will be able to focus on American news and sports.
The deal — announced Thursday — comes as the entertainment business goes through big changes. TV doesn’t have a monopoly on home entertainment anymore.
As consumers spend more time online, TV’s share of U.S. ad spending is shrinking. Advertisers are following consumer attention to the internet, where Google and Facebook win the vast majority of advertisers’ dollars.
To combat this trend, Disney is launching its own streaming services. It could beef them up with some of the assets it’s acquiring from Fox, making them exclusive
to its services and sharpening its ability to compete with Netflix for consumer dollars.
Disney CEO Robert Iger said many Fox properties will fit with the new service, including National Geographic and additional Marvel productions. In some cases, though, Disney will have to wait for existing Fox deals to expire.
Iger will continue as chairman and CEO of The Walt Disney Co. through the end of 2021.
Disney said Thursday that it anticipates at least $2 billion in efficiencies and other cost savings from the acquisition. Both companies’
boards have approved the deal. It still needs approval from Disney and 21st Century Fox shareholders.
Before the buyout, 21st Century Fox will separate the businesses it’s keeping into a newly listed company that will be spun off to its shareholders. It will also include the company’s studio lot in Los Angeles and equity investment in Roku.
Disney will also win majority control of Hulu, both its live-TV service and the older service with a big library of TV shows.