An “on again/off again” conversation between Disney Co. and 21st Century Fox could end in a major buy for Disney.
Disney CEO Bob Iger has bought up Pixar, Marvel Studios, and Lucasfilm during his tenure, drawing a great deal of public attention to the company’s rapid growth.
Iger even served on a White House advisory council, but stepped down “as a matter of principle” shortly after President Donald Trump announced that the U.S. would pull out of the Paris climate accord.
In early October, Iger announced at Vanity Fair’s New Establishment Summit that he’ll leave his CEO position at Walt Disney Co. in mid-2019, leading to speculation that he plans a future in politics.
But he may be working on one last major purchase for Disney while he’s still CEO.
According to CNBC, 21st Century Fox and Walt Disney Co. have been holding talks in the last few weeks to discuss a major media game changer.
21st Century Fox may sell most of the company to Disney.
The talks have taken place over the last few weeks and there is no certainty they will lead to a deal. The two sides are not currently talking at this very moment, but given the on again, off again nature of the talks, they could be revisited.
For Fox, the willingness to engage in sale talks with Disney stems from a growing belief among its senior management that scale in media is of immediate importance and there is not a path to gain that scale in entertainment through acquisition. The company is said to believe that a more tightly focused group of properties around news and sports could compete more effectively in the current marketplace.
According to CNBC, Disney has the capacity Fox lacks to compete with the changing face of media, with giants like Facebook, Google, Amazon, and Netflix redefining the landscape.
Purchasing much of 21st Century Fox would be another major buy for Disney, but the company would leave out some of the media corp’s key aspects if a deal is arranged:
Disney would not purchase all of Fox, according to people with knowledge of the talks.
The company could not own two broadcast networks and would therefore not buy the Fox broadcast network. It would not buy Fox’s sports programming assets in the belief that combining them with ESPN could be seen as anti-competitive from an antitrust standpoint and it would not buy the Fox News or Business channel. Disney would also not purchase Fox’s local broadcasting affiliates, according to people familiar with the negotiations.
In addition to the movie studio, TV production and international assets such as Star and Sky, Disney would also add entertainment networks such as FX and National Geographic.
Disney and Fox both declined further comments requested by CNBC leaving us in the dark as to how far the talks have come and whether or not a deal might be reached in the near future. A source speaking anonymously to Bloomberg says the talks are effectively “dead” for the time being and the “two sides aren’t talking anymore” (though that is Bloomberg’s phrasing, not direct quotes). Negotiations could, of course, resume in the future.
Will Bob Iger make 21st Century Fox his grand finale purchase before stepping down?
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