Disney, Fox in focus on Wall Street as deal talk heats up

Andrew Cummings
December 14, 2017

Disney shares could see a boost on the heels of the reported deal between the company and Twenty-First Century Fox as well as the release of the newest "Star Wars" film, some strategists say.

So, Disney looks nearly certain to emerge as the buyer of Fox's assets, and likely to see little or no opposition to the deal from a regulatory standpoint.

The Mouse House is close to buying some of Rupert Murdoch's media empire, to better compete with Netflix. The company also leases many buildings, such as its NY headquarters. The acquisition is estimated to be worth over $60 billion, which isn't too hard to imagine when considering Fox's film studios and television channels like FX, FXX, and Nat Geo. The runaway budget of "Cleopatra" half a century ago led the Hollywood studio to give up part of the property to raise cash.

"The acquisition of this stellar collection of businesses from 21st Century Fox reflects the increasing consumer demand for a rich diversity of entertainment experiences that are more compelling, accessible and convenient than ever before". Streaming services are offering great content whenever you want it and viewing habits have changed.

Comcast - one of the nation's largest internet service and cable television providers - already owns NBCUniversal, the company that owns NBC and Universal Pictures. Not only would it allow Disney to expand their entertainment line, it would also allow them to merge X-Men and Fantastic Four into the Marvel Cinematic Universe, something that fans have been waiting for, for a very long time. Fox shares rose 1.1 percent to $33.66 at the close in NY. The Murdoch family trust holds an economic interest of about 16 percent in New York-based Fox, which would translate to a stake of roughly 5 percent in Disney, according to data compiled by Bloomberg. That is always the case but if anything, the regulatory situation makes a deal with Disney more, not less, likely.

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