The last time Walt Disney came under attack from an unwanted suitor - a 1984 takeover attempt by the corporate raider Saul Steinberg - the company fought back with an acquisition of its own. By paying $200 million for the Florida real estate developer Arvida, Disney fattened itself and made it harder for Mr. Steinberg to swallow.
Now some investors are wondering if Disney may try that defensive gambit again. Since Comcast announced its unsolicited $54 billion offer for Disney on Wednesday, investors have bid up the shares of several putative targets, including the film studio Metro-Goldwyn-Mayer, Barry Diller's online services company InterActiveCorp, Steven P. Jobs's Pixar Animation Studios, the Internet company Yahoo, and, most notably, Charles W. Ergen's satellite TV service Echostar. On Wednesday, shares of Echostar quickly jumped $2.25 a share, to over $39.75, before falling back to close the week at $38.93.
But for Disney to buy its way out of Comcast's bear hug may not be so likely, analysts and industry executives said yesterday, because of questionable fits with the companies and the personalities involved.
Echostar is the company most often discussed as a potential defensive acquisition for Disney because it would add pay-television distribution to Disney's studios and networks, which include Miramax, ABC and ESPN. It would match some of the potential of combining Disney with Comcast's cable systems, or of the recent combination of News Corporation's Fox studios and networks with DirecTV.
Although Echostar's nearly 10 million subscribers give it less than half the reach of Comcast's cable operations, a satellite television company has more room to add subscribers because it is not bound by set territories. And Echostar, with a market capitalization of $19 billion, is the last free-standing cable or satellite television company to come anywhere close in size to Comcast, the largest cable operator in the country with 21.5 million subscribers.
Buying Echostar with Disney stock would also offer the strategic advantage of adding a major single shareholder in the person of Mr. Ergen, Echostar's founder, chairman and largest shareholder. Such a major individual shareholder could use his shares to effectively block any bid, Richard Greenfield, an analyst at Fulcrum Partners, said.
But at a conference Disney held for analysts in Florida this week, Disney's chief executive, Michael D. Eisner, flatly told investors that he did not think the company needed to enter the cable or satellite business. Instead, he and other Disney executives talked extensively of new technologies that might enable Disney to transmit films or programming through Internet connections or over the air.
"Eisner was very clear that he didn't want to do distribution, he was in the content business," said Tom Wolzien, an analyst at Sanford C. Bernstein. Still, he added, "When you have a gun to your head you look at things differently."
Then there is the question of Mr. Ergen's disposition.
"Anybody who thinks that Charlie Ergen would sell his company is out of his freaking mind,'' said Bob Scherman, editor and publisher of Satellite Business News, who said he had known Mr. Ergen for 20 years. Mr. Ergen, 49, relishes control of his company too much to give it up, Mr. Scherman said.
MGM, the last free-standing studio and the subject of perennial takeover speculation, would fit well with Disney's film businesses, but with a market capitalization of just $4 billion it would not add much bulk to deter Comcast. Nor would MGM's largest shareholder, Kirk Kerkorian, come away with a decisive stake in the combined company's stock.
Todd Mitchell, an analyst at Blaylock and Partners, argued that Disney's former partner Pixar, with a market capitalization of $4 billion, would be a logical fit. But its founder and chairman, Mr. Jobs, recently broke off talks about renewing the partnership after clashing with Mr. Eisner, a blow to the company that left Mr. Eisner particularly vulnerable to Comcast's takeover attempt.
Mr. Jobs, who is also chairman of Apple Computer, is unlikely to support a merger with Disney while Mr. Eisner is still in charge.
Others have suggested that acquiring Yahoo, with a market cap of about $31 billion, could effectively deter Comcast. Its chief executive, Terry S. Semel, is a former Warner Brothers studio chief who could potentially fill Mr. Eisner's role. But Yahoo's high price relative to its earnings would probably dismay Wall Street, conjuring up unpleasant memories of AOL Time Warner, Vivendi Universal or Disney's own ill-fated Internet investments.
Other analysts speculate that Disney might bid for InterActiveCorp, an online services company with a market value of $23 billion led by Mr. Diller, a longtime entertainment industry executive. Mr. Diller worked with Mr. Eisner at ABC and at Paramount earlier in their careers, and, in the event of Mr. Eisner's ouster, Mr. Diller could make a competent successor as well.
InterActiveCorp's online travel services businesses like Expedia are "not 180 degrees opposite'' from Disney's resorts and cruises, Mr. Wolzien, the analyst, said.
But it may be difficult to persuade shareholders that online services would fit better with Disney's core film and television business than Comcast's cable systems. And Mr. Diller has repeatedly disavowed any intention of returning to the entertainment business. Still, he always adds that the company will remain "opportunistic.''
Yesterday, a spokeswoman for InterActiveCorp declined to comment.
Analyst speculation about Disney has also included some private businesses, like the movie studio Dreamworks SKG. Its success in animation with movies like "Shrek'' could help Disney make up for the loss of its Pixar connection.
But one of its co-founders, Jeffrey Katzenberg, a former studio executive at Disney, left in a dispute with Mr. Eisner and then filed a lawsuit over his compensation. That makes Dreamworks another long-shot merger candidate while Mr. Eisner is still in the picture.
