The bidding war for 21st Century Fox has started. Today, Comcast made a $65 billion all-cash offer for the bulk of 21st Century Fox’s TV and studio assets, topping a previous $52.4 billion bid made by Walt Disney Company.
If successful, the move would bring together Comcast’s NBC broadcast network and the Universal movie studio with 20th Century Fox, the FX cable network and the regional Fox sports networks. The offer is valued at $35.00 per share in cash, representing a premium of approximately 19% to the value of Disney’s all-stock offer, according to Comcast.
“We have long admired what the Murdoch family has built at Twenty-First Century Fox,” Comcast CEO Brian Roberts wrote in a letter to Fox’s controlling Murdoch family, telling 21st Century Fox Executive Chairman Rupert Murdoch and his sons Lachlan and James that Comcast “would be the right strategic home” for the parts of the company that are for sale.
The financial bidding war comes just a day after a U.S. District Judge gave his blessing for AT&T’s to by Time Warner, without any conditions on the $85.4 billion deal. That approval signaled that Comcast might have less trouble getting the deal approved than previously expected.
If Disney comes out on top of the bidding war, the acquisition could cement Disney CEO Bob Iger’s legacy. Sealing a deal for Fox would cap off a slew of massive acquisitions under his aegis at Disney, which include a $4 billion buy of Marvel Entertainment in 2009; a $4 billion purchase of Lucasfilm in 2009; and $2.58 billion over three years for BAMTech, the streaming-video unit that is meant to power Disney’s various subscription-based video outlets.
But a deal would benefit Comcast similarly, adding new strength to its Universal movie production operations, its NBC Sports unit, and its cable programming operations.
Comcast’s $65 billion all-cash offer for Fox’s entertainment businesses is higher than the $60 billion that pundits had been predicting. Experts are expecting Disney to make a counter offer.
The battle for Twenty-First Century Fox comes as traditional entertainment companies try to amass more properties to compete better with technology companies such as Netflix for viewers’ attention — and dollars.