Originally posted by AliciaLuvzDizne
I am blown away that an outside company can even CONSIDER buying Disney!
Disney should be buying Comcast!!!!!
sigh
Stock value dictates that Disney could not come anywhere close to affording Comcast, Alicia. Also keep in mind that Disney has nearly $12 billion dollars worth of debt.
That said - I think Comcast acquiring Disney would be a very bad idea, because Disney is currently undervalued on the market, and recently reported better than expected earnings. Many of the market analysts are saying even with the $5 billion stock swap surplus that it's still an undervalued deal. This is good news for Disney, however, I fear a bidding war / feeding frenzy may start over Disney's assets (which is common once the door has been opened on these types of deals).
Before everyone starts blaming Eisner for this, please understand that he REFUSED TO NEGOTIATE THE SALE OF DISNEY and that's the only reason why this hostile takeover bid was put into place. If he wanted to sell the company and had the support of the board, we wouldn't have heard about any of this until it was a done deal awaiting only shareholder approval. Either way, it's truly out of his hands now.
The board and the shareholders will now have to decide whether to accept this offer. Even if it does go through, it could be subject to antitrust concerns and additional regulations that may
'potentially' stop it in its tracks.
Comcast is a horrible company. They offer lesser quality services on a regular basis, yet continue to raise their rates almost every quarter. Their customer service - in my opinion - is about the worst of any company I have dealt with. If they got control of Disney, it would probably cost about $700 for a days admittance and the number of attractions and CM's would be cut in half (ok sliiiiight exaggeration there :lol: )..
Seriously though, lets hope that the shareholders are not blinded by this opportunity to make a quick 5 billion dollar aggregate increase in their holdings. Long term it would dillute the Disney brand name and would ultimately hurt the newly formed company.
Just look at the AOL / Time Warner deal as a perfect example. I have never been a fan of 'stock swap' mergers for this very reason. A highly valued company can be snapped up by a smaller company with no tangible assets (although this isn't the case with Comcast). I think hostile bids should only be allowed when cash is tendered. Theoretically, during the dotcom boom, a lot of these now defunct companies could have purchased General Motors - but look at them now. They were all stock, with no assets or earnings, yet were valued higher than large American companies trading as Blue Chips.
Anyway, that's my input on the matter. Keep Disney on it's own. Although I wouldn't mind if they sold off ABC as a seperate division.
..early retirment even.