News Disney and Fox come to terms -- announcement soon; huge IP acquisition

[bartholomr4]

Also Comcast wont be just bidding more for FOX to put the squeeze on Disney as every time they do the price for Sky goes up as well so they would only be hurting themselves financially in the long run.

A couple of points.... When Comcast bids for sky, Disney does not have to reply back immediately. This provides additional leverage to getting to the July 27th shareholder bid, resulting in Disney winning 21CF.

Disney will then own 39% of Sky, which it does not have to sell to Comcast.

Assuming Disney does decide to sell the 39% of Sky....... For every 1.00 increase in Comcast's bid, 0.39 of that will go back to Disney. At the current bid of 14.00, that would be about $12.6 Billion to Disney. Assuming Comcast increases their bid to 15.0 for each sky share, Disney's take would rise by a billion to roughly $13.6 Billion

Disney Proxy values Hulu at $8.7 Billion. It is likely Disney would want to purchase the Comcast 30%, which would be between $2.6 to 3.0 Billion.

 

[seascape]

A couple of points.... When Comcast bids for sky, Disney does not have to reply back immediately. This provides additional leverage to getting to the July 27th shareholder bid, resulting in Disney winning 21CF.

Disney will then own 39% of Sky, which it does not have to sell to Comcast.

Assuming Disney does decide to sell the 39% of Sky....... For every 1.00 increase in Comcast's bid, 0.39 of that will go back to Disney. At the current bid of 14.00, that would be about $12.6 Billion to Disney. Assuming Comcast increases their bid to 15.0 for each sky share, Disney's take would rise by a billion to roughly $13.6 Billion

Disney Proxy values Hulu at $8.7 Billion. It is likely Disney would want to purchase the Comcast 30%, which would be between $2.6 to 3.0 Billion.

Provided Disney gets Fox and Comcast wins Sky, it is solely up to Disney to decide if they want Comcast to buy their 39%. Under the UK rules Comcast has to buy them out if Disney wants. Also don't think for a second that the UK board will approve any Comcast buy out of Sky until after Fox closes. This is a political board and will look after th he interest of the UK stockholders. So even if Comcast bids £15 a share for Sky and Fox/Disney give up and then Comcast bids more for Fox, count of the Board increasing the £15 a share price.

 

[Rodan75]

Provided Disney gets Fox and Comcast wins Sky, it is solely up to Disney to decide if they want Comcast to buy their 39%. Under the UK rules Comcast has to buy them out if Disney wants. Also don't think for a second that the UK board will approve any Comcast buy out of Sky until after Fox closes. This is a political board and will look after th he interest of the UK stockholders. So even if Comcast bids £15 a share for Sky and Fox/Disney give up and then Comcast bids more for Fox, count of the Board increasing the £15 a share price.

It feels like Comcast is rapidly getting boxed out of this and even has limited room to try and bid up the Disney's price. As discussed, there are so many better things for Comcast to throw cash at, that this really paints Roberts in a bad light.

 

[pdude81]

If nothing else though, he caused Disney and Fox-->Disney to pay a hell of a lot more for these assets. Perhaps that was good enough for Roberts

 

[seascape]

I just looked at the market. Disney is up 2.15%. Comcast is up 2.19 inches % and Fox is down 3.62%. This is a clear indication that the market has decided the battle for Fox is over and Disney will get Fox. It does not mean the battle for Sky is over but that the market believes Disney will either get it or get Comcasts money. If the market believed Comcast wasn't going to increase its bid, Comcast would be up more.

 

[Rodan75]

I just looked at the market. Disney is up 2.15%. Comcast is up 2.19 inches % and Fox is down 3.62%. This is a clear indication that the market has decided the battle for Fox is over and Disney will get Fox. It does not mean the battle for Sky is over but that the market believes Disney will either get it or get Comcasts money. If the market believed Comcast wasn't going to increase its bid, Comcast would be up more.

I'm assuming a 'gentlemen's agreement' will be struck this weekend at the Sun Valley conference, whether that is sacrificing SKY to Comcast or giving Comcast a new target to chase (I still think Malone is willing to sell Liberty Global).

 

[Stripes]

Interesting condition reported by WSJ: "Fox said that in the event the Disney and Fox deal falls apart because of regulatory issues, Disney will pay Fox £1 for every share of Sky that Fox buys as part of Wednesday’s higher offer. That caps Fox’s real exposure to £13 a share, should it not end up being acquired by Disney."

Leads me to believe that Disney is pulling the strings now for Sky.

 

[seascape]

Interesting condition reported by WSJ: "Fox said that in the event the Disney and Fox deal falls apart because of regulatory issues, Disney will pay Fox £1 for every share of Sky that Fox buys as part of Wednesday’s higher offer. That caps Fox’s real exposure to £13 a share, should it not end up being acquired by Disney."

Leads me to believe that Disney is pulling the strings now for Sky.

Sounds reasonable. Doesn't make a difference though because Disney has approval from the US and UK. The EU should be a piece of cake as will India. The only issue Disney has to decide is what they will do if Comcast bids more. I think they should just match a slightly higher bid but if Comcast bids a lot more, they should let Comcast have it and sell them the 39% and use that money to buyout AT&T and Comcast shares of Hulu and other worthwhile investments. Maybe even buy the Spiderman family movie rights from Sony.

 

[pdude81]

I see it mentioned somewhat frequently but I am not sure why Disney would rather have 90% of Hulu than 60% with NBC/Universal still having a financial interest in making the platform work with their content. This assumes that they still plan a completely separate streaming service from Hulu for Disney branded content.

 

[Rodan75]

I see it mentioned somewhat frequently but I am not sure why Disney would rather have 90% of Hulu than 60% with NBC/Universal still having a financial interest in making the platform work with their content. This assumes that they still plan a completely separate streaming service from Hulu for Disney branded content.

Comcast would get a vote on how Hulu spends its money, which would impair Disney's ability to run Hulu as a subsidiary. Apparently the board voting structure for Hulu is a mess and has been for years, Disney getting majority control wouldn't completely solve that mess.

 

[winstongator]

CNBC is reporting that COMCAST is focused on Sky now, as every increase in its offer for 21CF will automatically result in a corresponding increase in its bid for SKY. It is starting to look like best case for COMCAST is winning 61% of SKY. For COMCAST to get an counter offer for 21CF and all of the proxy materials out prior to the July 27th Shareholder meetings, they will have to have their bid public and proxy material mailed by next Monday.

It would be interesting to see what Disney will do with the 39% of Sky which comes with 21CF. Would this become a bargaining chip which would allow the two companies (Disney and Comcast) to trade a number of crossing assets (or surplus from a Disney perspective), and settle long simmering issues...... When Comcast won Sunday Night Football and wanted Chris Collins and Al Michaels, Disney agreed to a deal that included a number of things including rights to Oswald the Rabbit..... I can see a scenario where at the end of all of this, there will be similar horse trading....

How we get marvel in Orlando!

 

[Sirwalterraleigh]

So at the end of the day...Disney is still gonna “win” the weak IP holdings of fox for $71 billion...

That could be like the one horse that survived the Little Bighorn

 

[Rodan75]

I still can't believe Disney is growing, finishing the day at $108. I guess that means that the market had priced in another round of bids for 21CF and SKY. I agree with @seascape, the market thinks this is nearly over. Otherwise I don't understand why both Disney and Comcast would be going higher and Fox going lower.

 

[Sirwalterraleigh]

I see it mentioned somewhat frequently but I am not sure why Disney would rather have 90% of Hulu than 60% with NBC/Universal still having a financial interest in making the platform work with their content. This assumes that they still plan a completely separate streaming service from Hulu for Disney branded content.

Disney is bad at tech and doesn’t want to pay for it...they couldn’t handle paying for their own video games!!

I think that Hulu is really the prize and the rest is the gravy...they would rather just call Hulu something else and sell the existing platform.

 

[Sirwalterraleigh]

I still can't believe Disney is growing, finishing the day at $108. I guess that means that the market had priced in another round of bids for 21CF and SKY. I agree with @seascape, the market thinks this is nearly over. Otherwise I don't understand why both Disney and Comcast would be going higher and Fox going lower.

Isn’t the “market” a bunch of sharks looking for day to day quick bucks? (Rhetorical question)

It’s not nearly the exact science I think you’re giving it credit for...

 

[seascape]

Isn’t the “market” a bunch of sharks looking for day to day quick bucks? (Rhetorical question)

It’s not nearly the exact science I think you’re giving it credit for...

Fox was such a clear bargain at 52 billion that I posted for everyone here to put their money on Fox. I purchased my Fox shares after Disney made their first offer and have made a huge percentage return. I wish I had had more money to buy the stock but I made enough to be happy. It is not just Sharks that can make money on Wall Street. The thing to remember is if there is going to be a bidding war buy the takeover target and stay away from the buyers.

 

[Quinnmac000]

I still can't believe Disney is growing, finishing the day at $108. I guess that means that the market had priced in another round of bids for 21CF and SKY. I agree with @seascape, the market thinks this is nearly over. Otherwise I don't understand why both Disney and Comcast would be going higher and Fox going lower.

They are growing due to FCC has put out statements decreasing regulation for kids media to be aired on television as well as other beneficial statements.

Not likely directly tied to Sky/Fox merger

 

[Stripes]

Comcast has increased their Sky bid to £14.75.
https://www.cmcsa.com/static-files/255ceb25-10f4-45a3-a4cd-6d4e02fb77dd

 

[bartholomr4]

Comcast just increased its bid for Sky to 14.75 or 34 Billion

 

[mab7689]

Bloomberg and the Financial Times are now both reporting that Comcast have come back with a £14.75 per share offer. That's £26 billion in total.