Walt Disney eyes Hearst shares
From The Times
WALT Disney is considering selling a tranche of shares to the Hearst Corp, one of America's oldest and biggest private media companies, in an effort to fend off a $US50 billion ($63 billion) hostile bid from Comcast.
Hearst, which owns a stable of media assets, has a long-standing relationship with ABC, America's fourth-largest television network, which is owned by Disney. The private media dynasty, founded by William Randolph Hearst, who was portrayed in the classic Orson Welles film Citizen Kane, owns about 27 ABC franchises across the US and is therefore one of Disney's strategic television partners.
Hearst also owns a 20 per cent stake in ESPN, Disney's sports television and radio division, along with a 37.5 per cent stake in Disney's A&E Arts cable business and a 50 per cent share in Lifetime, Disney's cable channel for women.
Bankers working for Disney are looking at the possibility of selling a stake in Disney to Hearst, which is valued at about $US30 billion, to make the shares inaccessible to Comcast. Such an expedient move could derail the bid and force Comcast to concede defeat.
"One of the options for Disney would be to sell a piece of itself to someone else, which would make it much harder for Comcast to complete a takeover," said Tom Wolzien, senior media analyst at Sanford Bernstein in New York.
"Hearst and ABC have a very long relationship and are very close," he observed. "We would have to wait to see numbers before we could evaluate whether or not a strategy like this could succeed."
It is unlikely that Disney would attempt to buy Hearst or that the private media company would try to buy Disney.
A source close to the bid said: "Hearst is a big company with a very complex ownership structure. If Disney could tie up a lot of stock within that, then Comcast could be faced with some major problems if it wants to get this deal done."
Neither Disney nor Hearst would comment on the prospect of a stock sale.
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From The Times
WALT Disney is considering selling a tranche of shares to the Hearst Corp, one of America's oldest and biggest private media companies, in an effort to fend off a $US50 billion ($63 billion) hostile bid from Comcast.
Hearst, which owns a stable of media assets, has a long-standing relationship with ABC, America's fourth-largest television network, which is owned by Disney. The private media dynasty, founded by William Randolph Hearst, who was portrayed in the classic Orson Welles film Citizen Kane, owns about 27 ABC franchises across the US and is therefore one of Disney's strategic television partners.
Hearst also owns a 20 per cent stake in ESPN, Disney's sports television and radio division, along with a 37.5 per cent stake in Disney's A&E Arts cable business and a 50 per cent share in Lifetime, Disney's cable channel for women.
Bankers working for Disney are looking at the possibility of selling a stake in Disney to Hearst, which is valued at about $US30 billion, to make the shares inaccessible to Comcast. Such an expedient move could derail the bid and force Comcast to concede defeat.
"One of the options for Disney would be to sell a piece of itself to someone else, which would make it much harder for Comcast to complete a takeover," said Tom Wolzien, senior media analyst at Sanford Bernstein in New York.
"Hearst and ABC have a very long relationship and are very close," he observed. "We would have to wait to see numbers before we could evaluate whether or not a strategy like this could succeed."
It is unlikely that Disney would attempt to buy Hearst or that the private media company would try to buy Disney.
A source close to the bid said: "Hearst is a big company with a very complex ownership structure. If Disney could tie up a lot of stock within that, then Comcast could be faced with some major problems if it wants to get this deal done."
Neither Disney nor Hearst would comment on the prospect of a stock sale.
More Links:
http://www.nypost.com/business/18189.htm
http://business.timesonline.co.uk/printFriendly/0,,2020-9076-1007176-9076,00.html
