Comcast Could Buy Disney

[MouseRight]

Originally posted by djmatthews
Some of the figures you see include the debt they are buying, some don't.

Comcast's stock dropped yesterday - it's shareholders obviously reacted negatively to the deal and Comcast's ability to pull it off. If the stock stays down, it changes the value of the deal becuase they are offering shares of Comcast for shares of Disney. Their value goes down, so the value the Disney shareholders get is lower. This is one way that thedeal will struggle. This deal will be pushed upward. Disney's stock has been on the rise. Using 2005 projections many of the analysts think that Disney share would have gone up to teh 30's in the next year or two anyway. Thus the Comcast deal is not attrative at all, and it won't get Board or Shareholder support.

Let's hope it stays that way.

 

[jedimusik]

<<Comcast Wants Disney for $54 Billion>>

I was going to do 55 billion and use a credit card so I'll get miles.

 

[Nineinchnailsmk]

a local radio station this morning said that Comcast was going to offer Eisner a $150 million "golden parachute"

well, hopefully they dont merge. I really dont want to spend my honeymoon in Comcast World and I dont want to vacation at Comcastland in 2005 for the 50th anniversary. Heck, we can even visit Comcast's california adventure. There you can watch a big company rip off customers by charging $100 for basic cable!

 

[TURKEY]

Originally posted by MouseRight
Comcast's stock dropped yesterday - it's shareholders obviously reacted negatively to the deal and Comcast's ability to pull it off. If the stock stays down, it changes the value of the deal becuase they are offering shares of Comcast for shares of Disney. Their value goes down, so the value the Disney shareholders get is lower. This is one way that thedeal will struggle. This deal will be pushed upward. Disney's stock has been on the rise. Using 2005 projections many of the analysts think that Disney share would have gone up to teh 30's in the next year or two anyway. Thus the Comcast deal is not attrative at all, and it won't get Board or Shareholder support.

Let's hope it stays that way.

I don't think that the price of a merger will be anywhere near 65 billion.

With each proposed offer, Disney's stock should get a boost. Whoever is interested will have to offer to buy stock at a premium. It's just going to drive the cost of the merger up. If something were to happen, I think it will take something near $40 a share.

 

[MouseRight]

Originally posted by turkey leg boy
If something were to happen, I think it will take something near $40 a share.

Your analysis is in sync with the one heard on CNBC this morning. One of the analyst who is down at WDW for the presentations said the same $ range as you - $35 to $40 per share.

 

[SamatBCV]

Originally posted by MouseRight
There's an old saying - "I'd rather deal with the devil I know than the devil I don't know"

Exactly what I was thinking. For all of you who are thinking "Maybe this won't be so bad...", think again. I don't care what Comcast SAYS it will do, it has no obligation to follow through with that. Of course they are going to say rosy things about Disney's history and how they want to return to the glory days. It's a HOSTILE TAKEOVER. The only way they can do it is to board members and, more importantly, stockholders on their side. After it's done, they can do whatever they want.

Now, yes, maybe they will try to "bring back the glory days", but how long will that last. Since Disney would no longer be independant, that sentiment would only last as long as it works for Comcast. If things start to go sour as they often can when a company gets too big, Disney would be one of the first places to suffer. Remember, this is the BEST case senario of a Comcast takeover. The alternative is an immediate drastic decline in Disney quality.

Getting rid of Eisner is good, but NOT at ANY COST. Being in favor of forfeiting independence to get rid of a CEO who is already in trouble is not wise. IMHO

 

[thedisneyfan]

Comcast has way too much debt with their AT&T broadband takeover. If, they get Disney the debt of the combined company would be so high that the comcast bean counters would start slashing away at Disney & its theme parks. Its up to us shareholders to say NO.....plain and simple!

 

[Shaman]

This Reuters article offers some more insight into the whole issue

Most interesting was this part:

But investors' focus was elsewhere as they hoped that George Mitchell, the presiding director of Disney's board, in a luncheon address on corporate governance topics, would also shed light on Eisner's status.

Sander Morris Harris analyst David Miller, who was at the meeting, said he believed it was unlikely a white knight would emerge to rescue Disney from Comcast, but other options remained.

"There were other defensive and offensive moves Disney can make," he said, speculating that Disney could raise additional cash by selling off its radio properties and offering a dividend.

 

[thedisneyfan]

For Comcast to even make a realistic threat at the company, they need to offer about $90 billion. When that's done then maybe I'll be more concerned about Disney falling under the hands of Comcast. Disney could also fend off Comcast by accepting a less than perfect deal with Pixar, buying MGM, the Muppets, and some other properties to make Disney even more costly to purchase. Hopefully, they will do some of these things.

 

[Shaman]

Originally posted by thedisneyfan
For Comcast to even make a realistic threat at the company, they need to offer about $90 billion. When that's done then maybe I'll be more concerned about Disney falling under the hands of Comcast. Disney could also fend off Comcast by accepting a less than perfect deal with Pixar, buying MGM, the Muppets, and some other properties to make Disney even more costly to purchase. Hopefully, they will do some of these things.

Yes but if it does fend off Comcast...will it be successful in fending off other hostile bidders?

 

[MouseRight]

I am going into dangerous territory here but let's try this. IMHO - There is only one white knight company today that is not already vertically integrated with a major content provider and entertainment channel distributor. One with teh resources, and perhaps vision, to run Disney the way that most of us would like to see it be run. Microsoft. I say perhaps Gates has got the vision thing down but am not sure since I haven't spent too much time on studying him beyond normal press and public accounts.

Intriguing scenario - Don't you think?

 

[Shaman]

Originally posted by MouseRight
I am going into dangerous territory here but let's try this. IMHO - There is only one white knight company today that is not already vertically integrated with a major content provider and entertainment channel distributor. One with teh resources, and perhaps vision, to run Disney the way that most of us would like to see it be run. Microsoft. I say perhaps Gates has got the vision thing down but am not sure since I haven't spent too much time on studying him beyond normal press and public accounts.

Intriguing scenario - Don't you think?

Yea...I thought about Microsoft...but they have their own troubles (has Gates shown interest in vertically integrating in the past)...it is an interesting scenario nevertheless, makes me a bit nervous thinking who else other than Comcast might bid....

 

[SamatBCV]

Originally posted by MouseRight
I am going into dangerous territory here but let's try this. IMHO - There is only one white knight company today that is not already vertically integrated with a major content provider and entertainment channel distributor. One with teh resources, and perhaps vision, to run Disney the way that most of us would like to see it be run. Microsoft. I say perhaps Gates has got the vision thing down but am not sure since I haven't spent too much time on studying him beyond normal press and public accounts.

Gates has vision, but I wouldn't want him running Disney. As a techie, I deal with Microsoft too much to want them to run Disney. Also, they are completely different industries, so what would be the point. Finally, if ANY company buys Disney, then Disney independence is dead!!!!!

 

[MrPromey]

Originally posted by CTXRover
Why is that notion naive? I think not acknowledging that fact is more naive. Almost all the papers are saying Comcast is taking this chance when the board and Eisner are at their weakest in light of increased pressure they are getting from shareholders, especially Roy. I'm not saying Roy caused it, quite the contrary. There was talk about this Comcast thing WAY before Roy left and made his very persuading case to get Eisner out of there. But I think it is reasonable to assume that Comcast is taking the chance to do this now when the board and Eisner are under extreme pressures, mainly headed by Roy. And who knows, there are articles out there that say the board just might agree to something like this because it will solve a lot of the problems they are facing and pressures they are receiving from shareholders and Roy. Its more than just a coincedence Comcast is doing it now.

I bet this is what Roy had in mind when he set out to get rid of upper management. (sarcasm) I pointed out the possibility of something like this happening a week or so ago in a thread about the Pixar situation but I didn't really expect something like this to come along so quickly...

Actually, I think Roy bears a lot of responsibility for this and I say this because he knew from first hand experience how this kind of thing can happen when there is a strong public perception of management troubles. This is why Roy fought to get Eisner at the top of Disney in the first place - to fend off a hostile takeover.

His recent movies are certainly not the only thing that has caused Comcast to come calling but if Comcast is a shark, Roy has sure been spreading enough chum around for the last few weeks - the fact that he may himself be swiming in it dosn't excuse him.

Today, Disney is an independent company. Comcast talks of mergers but when all is said and done it is really Comcast buying Disney. That makes Comcast the name... or at least the first name.

When that happens, Disney is no longer a company, they are simply a brand and at that point, nothing that is done will be done in the best interest of Disney - only in the parent company... and considering how well similar deals have played out in recent years (Time Warner, Universal), I don't see how anyone can go into this expecting Comcast to follow through on their sales pitch, regardless of how nice they try to make it sound.

In any event, Comcast is going to have to come up with something better if they are going to get Disney at this point because Disney is trading for more today than the deal was worth when Comcast went public with this yesterday and Comcast is trading for less...

In any event, this deal would not be good for any serious fan of Disney.

 

[MouseRight]

Originally posted by MrPromey

In any event, Comcast is going to have to come up with something better if they are going to get Disney at this point because Disney is trading for more today than the deal was worth when Comcast went public with this yesterday and Comcast is trading for less...

In any event, this deal would not be good for any serious fan of Disney.

Great Post MrPromey. Particularly your comments about Roy.

It is time for Roy to put his ego aside, join with Disney's Board, stop the Comcast attack, and develop a succession plan to replace Eisner when he goes. Let's not forget this entire saga will take that long if the Comcast fight and government review takes as long as everyone thinks it will take.

Roy, do the right thing and "Save Disney".

 

[trekkie]

I am totally depressed here. I hate Eisner as much as the next Disney fan, but this Comcast thing makes me sick.
One of the most outlandish examples of corporate crap if I ever saw one. Never in a million years would I have guessed that I'd be on Eisner's side. Yet, here I am.
Yes, I want him out. But not if the only other option is a corporate mammoth like Comcast.
If Comcast does indeed buy Disney, I might just quit being a fan alltogether. I'm serious. This is beyond dis-heartening.

 

[jrriddle]

I don't think anyone's posted this. And it's from the NY Post so...
Note the part about Steve Jobs.

February 12, 2004 -- Time Warner is weighing a possible bid for Walt Disney Co. to counter Comcast's surprise hostile takeover offer for the beleaguered entertainment giant, The Post has learned.
Time Warner, the world's biggest media company, was scheduled to hold a conference call with investment bankers yesterday afternoon to discuss the possibility of making a run at Disney, say sources familiar with the situation.

Meanwhile, Pixar Animation Studios' Steve Jobs was understood to be in active discussions with parties, including cable operators, about putting together a team to emerge as a potential white knight for the Mouse House.

A Time Warner spokesman declined to comment on whether the company would make a bid for Disney but did say Time Warner "has not engaged bankers." Pixar declined comment.

Potential suitors for Disney, including Time Warner, Viacom and Pixar, are being forced to jockey for position in what may turn into a bidding war for the storied entertainment giant following the $66 billion unsolicited takeover bid that Comcast launched yesterday.

Philadelphia-based Comcast offered to exchange 0.78 of a share of its own stock for each share of Disney, plus the assumption of $11.9 billion of debt, in a tax-free deal that would combine the entertainment icon's studios, broadcast network and theme parks with Comcast's powerful distribution channels. Disney shareholders would own 43 percent of the merged entity.

Disney said its board will "carefully evaluate" the buyout proposal for the company, whose assets include the ABC television network, Walt Disney theme parks, ESPN and other cable channels and the Disney and Miramax studios.

In many ways, the timing of Comcast's bold bid couldn't be better for Comcast. Disney CEO Michael Eisner, who has been in the hot seat for months for the company's poor performance, has come under increased pressure from dissident shareholders calling for his ouster.

What's more, Disney has left itself vulnerable to a hostile takeover because it has virtually no defense tactics in place, legal experts say.

Disney currently does not have a poison pill, and it removed its staggered board, which means that Disney shareholders can act to remove board members by written consent at any time.

"Not having a staggered board definitely makes Disney somewhat more vulnerable," said Stephen Fraidin, a partner at Kirkland & Ellis in New York.

But Disney's best defense for now may simply be to turn down Comcast's bid as too low, Fraidin said. The stock offer values Disney's stock at $26.47 per share, a modest 10 percent premium over Disney's closing price of $24.08 on Tuesday.

Yesterday, Disney's stock shot up to $27.60, up 14.6 percent. Meanwhile, Comcast's shares fell $2.84, or 8.6 percent, to close at $30.10 in Nasdaq trading.

 

[Raidermatt]

Disney is no longer a company, they are simply a brand and at that point...

Ahh, Michael Eisners Corporate Mission Statement.

 

[SamatBCV]

Originally posted by jrriddle
Meanwhile, Pixar Animation Studios' Steve Jobs was understood to be in active discussions with parties, including cable operators, about putting together a team to emerge as a potential white knight for the Mouse House.

I mentioned this earlier in this thread when I referenced a Motley Fool article from last week.

 

[jrriddle]

Must have missed that sorry.