21st Century Fox has scheduled a July 10 vote to gain shareholders’ approval for the company’s proposed $52.4-billion sale of key assets to Walt Disney Co.
That means Comcast Corp. must work fast if it wants to derail the Disney deal so it can scoop up the prolific 20th Century Fox film and television studios, 22 regional sports networks, FX, National Geographic channels and key international television properties in Europe, India and Latin America.
The special meeting is being called so Fox shareholders can “consider and vote on a proposal to adopt the previously announced merger agreement” with Disney, Fox said in a statement Wednesday. “21st Century Fox’s board of directors recommends that stockholders vote in favor of the proposal to adopt the Disney merger agreement.”
Last week, Comcast announced it was in “advanced stages of preparing” a renewed bid for the same Fox properties that Disney is trying to buy. The Philadelphia cable giant has been busy lining up financing to pull off an all-cash deal of about $60 billion, which is about 16% higher than the Disney bid, and some insiders expect Comcast to officially make its offer by mid-June.
A renewed Comcast bid could put Rupert Murdoch, Fox’s chairman, and Disney’s chairman and chief executive Bob Iger in a tight spot. In December, Murdoch said no to Comcast Chairman and Chief Executive Brian Roberts after nearly a month of negotiations between Fox and Comcast and the companies’ bankers, according to regulatory filings. Murdoch instead opted for Disney’s stock bid, which would give Fox shareholders stock in Disney.
The mogul from Australia figured that a union with Comcast would face a more rocky reception from government regulators than a Disney bid. But not all analysts agree on that.
Iger, for his part, might have to fend off Comcast by raising Disney’s offer.
Comcast is waiting to see whether a federal judge in Washington approves a different blockbuster media combination: AT&T Inc.’s $85-billion purchase of Time Warner Inc. The Department of Justice sued to block the AT&T-Time Warner combination, and the case was argued during a two-month trial this spring in Washington. U.S. District Judge Richard Leon, who is overseeing the case, has said he will decide by June 12 whether to allow the AT&T-Time Warner deal.
Leon’s ruling on the AT&T-Time Warner issue might not even be that relevant to the Fox situation, according to Bernstein & Co. media analyst Todd Juenger.
“We are even starting to question how much is contingent on that outcome, and how much of a regulatory burden really does exist for Comcast. It seems to us that most of the Fox assets — and especially the Fox assets that Comcast most wants — have very little regulatory concern,” Juenger wrote in a recent report.
For now, Disney and Fox have taken a wait-and-see attitude over Comcast’s potential bid.
Fox on Wednesday acknowledged that it may have to “postpone or adjourn the special meeting of its stockholders” on July 10 should there be new information that shareholders should consider, such as a higher bid from Comcast. Some Fox shareholders have cheered on the prospect of a bidding war.