Disney Outbids Comcast for 21st Century Fox Assets

(June 20th, 2018): Just a week after Comcast outbids Disney’s original offer, Walt Disney ($DIS) raises offer to $71.3 billion to acquire 21th Century Fox ($FOX) assets at $38/share, up from its December 2017 offer of $52.4 billion (all stock) at $28/share. Disney’s new proposal gives the option of cash or stock, while Comcast’s ($CMSCA) current bid of $65 billion made last week is in all cash and at a valuation of $35/share.

Fox ($Fox) jumps 7.25% at end of the day (June 20th, 2018).

Disneyflix?: Disney’s Streaming Projects 

Disney currently has a minority stake in Hulu (30%), and Fox owns another 30%. The acquisition of Fox will help position Disney to have a majority control in Hulu streaming. The acquisition of Fox, which currently owns 30% of Hulu, will position Disney to not only compete with Netflix but will also give them more assets to dethrone Comcast as the current #1 media company by revenue (Disney is 2nd).

Disney also currently has a majority stake in ESPN (80%) and is actively looking to acquire more assets to boost its dominance in entertainment. Disney’s new online video-streaming service is looking to launch in 2019, which will complement Disney’s ESPN+ sports streaming, launched in April 2018, and is currently being offered at $4.99/month.

Disney has stated that R-Rated films will not be included on this new platform, which is catered towards a younger audience, and instead will go to Hulu. The new streaming service will include Marvel Films, Pixar & Disney Movies, and Star Wars Films. Disney will also look to create more exclusive content for this platform. For TV shows, the service will have “High School Musical,” an animated “Monsters Inc.” series, a Marvel live-action title, and a is actively creating several “Star Wars” live-action title.

List of Current Disney Assets:

  • Lucas Films (Star Wars series): Acquired in 2012 for $4 billion in cash & stock
  • Marvel Entertainment: Purchased for $4 billion in 2009
  • Hulu (30% minority stake), joint with Fox (30%), Comcast (30%), and AT&T (10%)
  • ESPN: 80% joint stake

Disney could very well pull its content off of streaming services like Netflix and Hulu, and exclusively offer it to its own Disneyflix streaming service, making it a very intriguing service to sign up for. Would you sign up for another online-streaming service, if it means that it will contain exclusive Star Wars series, Marvel films, and Pixar & Disney movies?

So, is Disneyflix coming soon?

Stay tuned for an update on the Disney/Fox merger.

 

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