Breaking News
0

Fox chose Disney over Comcast on regulatory, stock fears: filing

Stock MarketsApr 18, 2018 09:55PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. A screen shows the trading info for The Walt Disney Company company on the floor of the NYSE in New York

By Carl O'Donnell and Ankur Banerjee

(Reuters) - Rupert Murdoch's Twenty-First Century Fox Inc, which agreed in December to sell most of its assets to Walt Disney Co for $52.4 billion, had previously rejected a bid from Comcast Corp (NASDAQ:CMCSA) over concerns about the regulatory risks and its stock value, a regulatory filing on Wednesday showed.

The joint filing by Disney and Fox, which outlines the timeline of their negotiations, offers the most detailed insight yet into Fox's thinking, as it goes head-to-head against Comcast, a U.S. cable operator, in its bid to acquire European pay-TV company Sky Plc (LON:SKYB), in which Fox holds a 39 percent stake.

Comcast announced in February it was working on a $31 billion bid that would top Fox's deal for Sky. It has not made a new attempt to bid for the Fox assets after the Disney deal, so investors are keen for information on the hurdles that prevented an agreement between Fox and Comcast.

The filing does not mention Comcast by name, but refers to it as Party B. Another bidder for the Fox assets, U.S. wireless carrier Verizon Communications Inc (NYSE:VZ), is referred to as Party A.

Verizon and Comcast representatives did not immediately respond to requests for comment.

Comcast on Nov. 14 offered to acquire most of Fox's assets in an all-stock deal valued at $34.41 per share, the filings said. Fox ended up announcing an all-stock deal with Disney for $29.54 per share.

Like Disney, Comcast sought to buy Fox's entertainment networks, movie studios, television production and international assets, the documents show.

In the filing, Disney and Fox said the ongoing antitrust scrutiny of U.S. telecommunications provider AT&T (NYSE:T) Inc's planned merger with media conglomerate Time Warner Inc (NYSE:TWX) heightened concerns about potential regulatory hurdles to Comcast's bid. The U.S. Department of Justice has sued AT&T and Time Warner to thwart their deal, and the case is in court.

The companies added that, unlike Disney, Comcast declined to offer a reverse deal termination fee, which would compensate Fox in the event that regulators stymied a deal. Disney offered a reverse termination fee of $2.5 billion.

The companies also said that Fox saw Disney's stock as more valuable than Comcast's, based on historic prices, and felt that a deal between Disney and Fox would generate greater long-term value. The Roberts family controls Comcast through a dual-class stock structure.

Comcast's proposal, on the other hand, would reduce the compensation offered to Fox shareholders in the event that asset sales were required to reassure antitrust regulators, increasing the potential risk to Fox shareholders, the filing said.

Verizon's bid was rejected because it offered to acquire Fox at market value, without a meaningful premium, according to the filing.

Fox chose Disney over Comcast on regulatory, stock fears: filing
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments
Lōx Gus
Lōx Gus Apr 18, 2018 8:25PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Disney start
Reply
0 0
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email