14th Jun 2018 06:55
WASHINGTON (Alliance News) - US cable company Comcast Corp is seeking to pry Twenty-First Century Fox Inc away from The Walt Disney Co, by on Wednesday making a bid of USD65 billion to thwart Disney's effort to take over the media company.
Rupert Murdoch's Fox will have to decide in a board vote onJuly 10 on which offer it prefers. Disney had previously bid USD52.4 billion for the media wing of Fox, which would not include its news or sports elements, including the flagship FoxNews.
The move is a signal of changes afoot in the US media landscape as cable companies realize they are losing out customers to other services, such as online streaming content provider Netflix which continues to grow it subscriber base.
Comcast's new bid, an all-cash offer, comes a day after a federal judge approved telecommunication giant AT&T's proposal to buy Time Warner, which the administration of President Donald Trump had tried to stop.
Disney's offer was stock-based, on top of being 19% less than what Comcast is bidding for Fox, which has produced hit franchises including superhero movies such as the X-Men series.
As with 21st Century Fox's pending transaction with Disney announced in December 2017, Comcast's proposal contemplates that prior to the acquisition, 21st Century Fox will separate the Fox Broadcasting network and stations, Fox News Channel, Fox Business Network, FOX Sports, FS1, FS2 and Big Ten Network into a newly listed company that will be spun off to its shareholders or "new Fox".
Comcast will agree to the same reverse termination fee of USD2.5 billion as Disney, in the event the transaction does not close as a result of a failure to obtain the required regulatory approvals.
In addition to payment of the USD2.5 billion reverse termination fee, in the event that its transaction is terminated due to a failure to obtain the required regulatory approvals, Comcast said it also will agree to reimburse Fox for the USD1.53 billion break-up fee required to be paid to Disney in connection with termination of the Disney transaction and entry into a merger agreement with Comcast.
Comcast has separately announced a pre-conditional all-cash firm offer for the entire issued and to be issued share capital of Sky PLC.
Comcast intends to pursue the offer in parallel with its acquisition of Fox, it said, adding the terms of any transaction between Comcast and 21CF will need to be consistent with respective obligations under the UK takeover regime.
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