Home » Comcast/Xfinity »Competition »Reuters » Currently Reading:

Comcast Prepares All-Cash Bid to Acquire 21st Century Fox for $52 Billion

Phillip Dampier May 8, 2018 Comcast/Xfinity, Competition, Reuters 1 Comment

(Reuters) – U.S. cable operator Comcast Corp is asking investment banks to increase a bridge financing facility by as much as $60 billion so it can make an all-cash offer for the media assets that Twenty-First Century Fox Inc has agreed to sell to Walt Disney Co for $52 billion, three people familiar with the matter said on Monday.

Comcast Chief Executive Brian Roberts only plans to proceed with the bid if a federal judge allows AT&T Inc’s planned $85 billion acquisition of Time Warner Inc to proceed, the sources said. The U.S. Department of Justice has opposed the AT&T-Time Warner deal over antitrust concerns, and a decision from U.S. District Court Judge Richard Leon is expected in June.

Disney Chief Executive Bob Iger clinched an all-stock deal with Fox Executive Chairman Rupert Murdoch in December to acquire Fox’s film, television and international businesses, giving the world’s largest entertainment company an arsenal of shows and movies to combat growing digital rivals Netflix Inc and Amazon.com Inc.

Comcast, owner of NBC and Universal Pictures, has also made a 22 billion pound ($30 billion) offer to acquire the 61 percent stake in European pay-TV group Sky Plc that Fox does not already own. In doing so, it topped an earlier offer for the entirety of Sky by Fox.

Last November, Comcast offered to acquire most of Fox’s assets in an all-stock deal valued at $34.41 per share, or $64 billion, a regulatory filing showed last month. Like Disney, Comcast sought to buy Fox’s entertainment networks, movie studios, television production and international assets, the filing shows.

Fox ended up announcing an all-stock deal with Disney for $29.54 per share. In the regulatory filing, Disney and Fox cited regulatory hurdles as reasons to reject Comcast’s bid, even though they did not reference it by name.

The exact value of Comcast’s new bid for the Fox assets is not yet clear, although the $60 billion in new financing indicates it is seeking significant firepower to outbid Disney. Comcast already has a $30 billion bridge loan to finance its Sky offer.

The sources asked not to be identified because the matter is confidential. Comcast, Fox and Disney declined to comment.

Fox shares rose 5.13 percent to $39.99 on the news in after-hours trading in New York on Monday. Comcast shares were down 1.5 percent to $31.90, while Disney shares were down 0.5 percent to $102.00.

Murdoch, who owns close to a 17 percent stake in Fox and holds about 40 percent of the voting power, prefers to be paid in stock rather than cash for the Fox assets, because this makes the transaction non-taxable for shareholders, sources have said. It is not clear how receptive he would be to an all-cash offer.

Last month’s regulatory filing also showed that Fox viewed 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 stock has dropped since then, from around $38 to about $32 now, giving the company a market capitalization of $149 billion.

Disney has committed to share buybacks as a way of returning cash to Fox shareholders. As a result, Comcast sees an opening in being disruptive to the deal by making an all-cash bid, according to the sources.

In its deal with Disney, Fox agreed to separate the Fox Broadcasting network and stations, Fox News Channel, Fox Business Network, its sports channels FS1, FS2 and the Big Ten Network, into a newly listed company that it will spin off to its shareholders.

Reporting by: Greg Roumeliotis and Liana B. Baker in New York; Additional reporting by Jessica Toonkel in New York; Editing by Tiffany Wu and Lisa Shumaker

Currently there is 1 comment on this Article:

  1. Limboaz says:

    It’s amazing what Comcrap can do with all that money they have stolen from their the subscribers with their Cable and broadband Internet monopoly.







Search This Site:

Contributions:

Recent Comments:

  • Dylan: I better be getting 200mbps instead of 100 soon then if I do get a increase from $55 to $60 for bundle internet services. I understand the investments...
  • Charles Dennett: Just looked at my bill dated October 14. I'm in the Rochester, NY market. I have Spectrum TV select ($64.99/month), DVR Service ($12.99/month) and 10...
  • Gale Blue: It’s sounds good until u paid ur money and then u get an email saying they need additional info smh I am a mother who lives wit my daughter and the ca...
  • Victor Bosnich: Have been trying to return this junk and get my refund of $100+ for months, finally had chat with technician, told him situation, he sent me to next p...
  • Jr: Can I still use the same wifi router they gave me? I'm going to get the Netgear but it says I need a router to get WiFi so what do I do?...
  • RJ: I get great service from Charter with Internet. Their upload speed sucks so they need to upgrade, innovate and get Full duplex going. I'd love to have...
  • Inga Nobles: Forgot password and username I'm enquiring about the promotion samsung chromebook...
  • fhall1: The PSC should also make a point of extending other "conditions" that were agreed to as part of the TWC buyout. For example - data caps. Spectrum ag...
  • Frontier Employee: I am a current Frontier Employee and I can promise you that the company's lack of concern for those less fortunate does not solely reside with its cus...
  • JayS: The MVNO US Mobile has just changed their 'Unlimited talk & Text + data plans' similar to what you have indicated. The Unlimited Talk & Text ...
  • Peter: I made three appointments over a period of three weeks ... the tech serviceman never showed ... and they never contacted me to tell me why. When I ca...
  • Joe: liveTexas, how much did YouTube pay you for that ridiculous post?...

Your Account: