Coverage: Comcast plans to outbid Disney for Fox
Comcast Corp. confirmed that it is in the advanced stages of preparing an all-cash offer for 21st Century Fox intended to trump Walt Disney Co.’s $52.4-billion stock bid.
Meg James and Stephen Battaglio of the Los Angeles Times had the news:
The stakes are enormous: The power play could determine which media company — Disney or Comcast — will wind up being the dominant entertainment company in Hollywood and beyond.
“While no final decision has been made, at this point the work to finance the all-cash offer and make the key regulatory filings is well advanced,” Comcast said in a statement.
Comcast already controls internet and cable systems and NBCUniversal, which owns the NBC network, cable TV channels including USA, Bravo, E! and the Golf Channel, the Universal Pictures film unit and Universal Studios theme parks. The company wants to get even bigger to compete against tech giants Netflix, Facebook, Google and Amazon that have invaded the entertainment space.
Comcast stock fell nearly 2% to $31.88. Disney shares slipped 1.2% to $102.89. Fox, meanwhile, saw its shares rise 1.6% to $38.77.
Chris Isidore and Jill Disis of CNNMoney.com reported that the offer could be as high as $60 billion:
Comcast did not detail the exact value of its bid Wednesday, though sources have previously told CNN that the offer would be worth about $60 billion.
Fox declined to comment Wednesday. During an earnings call two weeks ago, executive chairman Lachlan Murdoch said the company would not “engage in a lot of speculation around this,” though he added that Fox is “committed to our agreement with Disney.”
“In addition, our directors, though, of course are aware of their fiduciary duties on behalf of all shareholders,” he said.
Disney did not immediately respond to a request for comment.
Evelyn Cheng of CNBC.com reported that a major Fox shareholder would back Comcast’s bid:
Earlier in the day, Comcast said it is in “advanced stages of preparing” a “superior” all-cash offer for the parts of Fox that Walt Disney has agreed to buy. However, Fox may find Comcast’s bid less attractive since it would be taxable, versus a tax-free spin-off in a deal with Disney, sources told CNBC’s David Faber.
Regardless, Hohn urged Murdoch in a letter, a copy of which was seen by CNBC, “to immediately engage” with Comcast. “The personal tax position of the Murdoch family must be an irrelevant consideration for the board, in order for the board to comply with their fiduciary duties,” Hohn said.