ford91exploder
Resident Curmudgeon
Stories like this warm the cold black stone that passes for my heart. I really,really dislike 'Big Media' I don't care what side of the aisle they are on.
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News Disney and Fox come to terms -- announcement soon; huge IP acquisition
- Thread starter ohioguy
- Start date
Stories like this warm the cold black stone that passes for my heart. I really,really dislike 'Big Media' I don't care what side of the aisle they are on.
the.dreamfinder
Well-Known Member
Comcast formally offers higher bid for Sky than 21st Century Fox. Sky, in turn, no longer favors Fox’s bid and will maintain a neutral position to get the best deal. Without 100% of Sky, the Disney-Fox deal loses considerable value.
https://www.hollywoodreporter.com/news/comcast-makes-31b-takeover-offer-sky-official-1089288
https://www.hollywoodreporter.com/news/comcast-makes-31b-takeover-offer-sky-official-1089288
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It will be an interesting battle. If Comcast really wants Sky, they have to buy the 39% so on to be owned by Disney. What will Disney ask for besides 39% of the 31 billion. Just for the themepark fans here the combined market cap of Seaworld, Six Flags and Cedar Fair is 11 billion. Which is still 1blion dollars less than what Universal would have to pay Disney/Fox. Also to consider is Universal only has 23 billion in financing to buy the portion of Sky Fox does not own but based on British law and the decision they told Disney that they would have to buy the entire company, Comcast will need over 8 billion more in financing. This will be an interesting battle and will have major implications on what either company can do in the future if this purchases with debt or equity. I think if Disney uses stock to purchase both Sky and Fox it would be the better deal for the current Fox and Sky shareholders because of the upside. Comcast stockholder on the other hand while not being deluded will be taking on a much higher risk and debt load thus preventing other investments.
What is the view on the future of Sky on Your side of the pond?
The company is a huge power in the UK. Possibly bigger than any one US network, and certainly has a perception with joe public bigger than Comcast in the US. Since it’s a content provider perhaps comparison to US networks is wrong, as it can’t be compared to say the BBC in that way, but it is a huge part of UK TV.
Which company do you think would be better for England? Politically both lean left but comcast is louder with MSNBC. In some ways I would like Sky News brought over here with the hope of getting another point of view. However no matter what Comcast promises I see them taking over Sky News and making it just like MSNBC. If anyone thinks the Murdochs are controlling they should really look at Roberts and his power hungry control of Comcast. The two deserve each other. It is also the reason I dont see Comcast ever agreeing to buy Fox using stock. Robert's does not want his power diluted.
Quinnmac000
Well-Known Member
Disney is a minority owner so its not like they have any power. But maybe for that 39%, majority power of Hulu, and them paying for the retheme of Marvel Super Hero Island they would give it up.
Comcast has to buy Disney out as required by British law. They have no choice but to pay Disney just under 12.1 billion unless Disney decides to partner with them in Sky. So the better question is does Comcast really want to take on 12.1 billion in more debt to buy Disney out or would they rather use that money on something like a 3rd and 4th gate in Orlando. They really can't afford to take on 31 billion more in debt for Sky and 10 to 15 billion more to build 2 gates, new shopping area and other additions in the next few years. Disney is not stupid, they would make Comcast take on the debt while Disney's merger with Fox is stock based and buying 61% of Sky using Comcast's valuation would require 18.91 billion in debt or they could try a stock deal.
BTW, using stock and not debt will dramatically increase profits and give Disney more money for future growth while debt ties the hands of the company and prevents future growth. Another thing to consider is there are rumors Comcast will make another run at Fox and since their prior offer was cash, thus debt, they would need to borrow approximately 100 billion dollars to complete the mergers. Who here thinks that is a good idea? Wall Street doesn't and that is why Comcast stock went down so much when the Sky offer was proposed a few weeks ago.
I think both would have merits. So far as the customer over here is concerned so long as they get their soccer (Sky sports is a massive set of pay channels) they possibly don’t care. Personally I don’t care for Sky News since I feel it’s a bit too tabloid for me. I’d worry for the Sky customer that Igers ever increasing search for profit would hit the Sky network too. I don’t really deal with Sky peronally (I’m with a rival provider).
Talking of debt and monies, I wouldn’t say Disney buying Fox outright would be fantastic for the parks either. Burbank is already jittery. The recent reallocation of funds for park projects are a taste of that.
Indy_UK
Well-Known Member
While SKY has the monopoly over here, I think people are getting jittery at just how expensive SKY is becoming especially when people have loads of other options available to them. I pay the equivalent of $102 a month for my SKY and Fibre broadband and I'm struggling to justify the price ATM. Its the sports fans they have hooked in with no other options.
With Disney in charge, I can only see ever increasing costs
With Disney in charge, I can only see ever increasing costs
I think Wall Street is starting to realize how good an investment themeparks are. Six Flags is up over 9% today. They figured out how to maximize profits with up sale memberships. I have had their annual passes for years and paid 350 for my wife and I for a year with 2 meals a day, a snack and unlimited beverage. This year they came out with a m er membership of 22.35 a month for each of us but it includes preferred parking, 2 front of line passes, free maze passes during fright feast, preferred seating at their shows and the meal plan. So we will pay 536.40 a year. The added benefits cost them just about nothing and they make 186.40 more profit. Smart move on their part. They are learning from Disney and Universal and their stockholder make out too. I am glad I own their stock, Cedar Fair and Disney. I even have Seaworld stock I purchased last year at about 12.00 a share.
the.dreamfinder
Well-Known Member
There’s a misunderstanding here of how the Robertses approaches politics versus the Murdochs. The Roberts family doesn’t use MSNBC to advocate for their political views like the Murdochs. MSNBC being a left leaning net was something they inherited and a minor asset compared to NBC or Universal Studios.
The Roberts family is super subtle about their political leanings, pro consolidation and anti-competitive. They are very deft in lobbying to get exactly what they want. There’s a reason why Apple or Microsoft’s efforts to remake cable tv into something like your smartphone never went anywhere. It’s a means to an end for them instead of an ideological calling. In those terms, CMSA would be preferred over the Murdochs or TWDC with that family having considerable holdings in said company.
102 a month is nothing compared to the cable companies on this side of the pond. Triple play packages including TV, broadband and phone cost over 160 a month on average.
You missed my point while actually making it. You said the Roberts family get what they want by lobbying better. The fact is they want power and get their way is exactly what I said. They and the Murdochs are perfect together. Politically the Murdoch children lean left also. As a conservative who wants real competition I am against either company being allowed to get bigger. In fact Comcast should not have been allowed to buy NBC Universal and should broken up. OTOH as a Disney stockholder I want Disney to buy Fox and Sky to maximize their growth and profits. At the same time I hate the idea of Comcast getting a hold of those two companies. The worldwide power Comcast would have over Movies, Television production and distribution and News would be way too much. Disney Fox and Sky would only have too much power in Movies and Television production. Distribution wise they would be about the same worldwide size as Comcast. On the News front Disney may in fact add competition in the US by bringing Sky news to the US.
Rodan75
Well-Known Member
I really think this is why Disney/Fox will let SKY go to Comcast (at best Disney or Fox will offer a barely competitive counter to keep the theatre going). I think it will preclude a competitive bid for Fox, because of the shareholder reaction.
I think Comcast was baited into this move and Iger/Murdoch knew that either SKY or HULU was going to be sacrificed to make their deal work.
Quinnmac000
Well-Known Member
But if that's the case why after the deal was finalized is Comcast stock going up instead of down? Also the Fox deal won't come unless the AT&T and TW deal goes through which is growingly seeming that it won't.
Comcast is working hard on foreign investments which makes sense why they went for Sky and I would bet in the next 12 months we will see them try to acquire a Japanese media company as well (3 job openings for content acquistions in Japan right now).
Comcast didn't want Fox for the IPs they wanted it for Sky and the foreign distribution. They would have to divest Fox Searchlight and a lot of other divisions because they already have so much overlap.
Rodan75
Well-Known Member
The stock market aspect of this will take time to play out, but at the moment I’m assuming there is relief that SKY is the plan and not Fox.
But I agree with you on the rest. Comcast going for Sky makes sense with their needs and Disney going for Fox makes sense. Either going for Fox+Sky felt like overreach and regulatory hurdles. But all of this feels a little too coordinated.
the.dreamfinder
Well-Known Member
I know folks get all worked up about the film side, but both Disney and Comcast want the international TV assets. Iger’s reaction to the ESPN and ABC declines is to balance out the media nets business with international nets. If you exclude Disney Channel from Media Networks, the Cap Cities companies are pretty much US assets.