Disney, Fox Shareholders Approve $71.3B Deal

Closing expected in first half of next year
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Shareholders of The Walt Disney Co., and 21 Century Fox overwhelmingly approved the $71.3 billion deal that would place several former Fox programming and production assets under the Mouse House umbrella, paving the way for the long-fought deal to close.

According to Disney, about 99% of its shareholders approved the deal, while Fox its stockholders were also in favor of the transaction.

Disney had agreed to purchase the Fox assets in December, but Comcast, which had been one of the early bidders for the assets, threw a wrench in that deal in June with a competing all-cash offer of $65 billion. That touched off a moth-long bidding war for the assets, while Disney ultimately won by raising the stakes to $71.3 billion in cash and stock. Comcast, sensing it could no longer justify escalating the fight any further, dropped its bid earlier this month.

Bob Iger and Rupert Murdoch, December 2017, Disney-21st Century Fox deal

Robert Iger and Rupert Murdoch

Related: Roberts: Shareholder Value Drove Fox Decision 

After the deal is closed, Fox will concentrate on live sports and news, retaining the Fox broadcast network and its owned and operated television stations, cable sports channels FS1 and FS2, Fox Deportes and Big Ten Network, and news networks Fox News Channel and Fox Business Network.

Disney received federal approval of the deal in June, as long as it agrees to divest Fox’s 22 regional sports networks within 30 days of closing. While U.S. approval is in hand, the deal still needs to receive the nod from international regulatory bodies, which is expected to take until the first half of next year.

Some analysts have estimated the value of the RSNs at around $22 billion. Fox owns a controlling stake in one of the top RSNs in the country – the Yankees Entertainment and Sports Network (YES) which televises New York Yankees Major League Baseball games as well as others. Speculation is that the Yankees and Mets may try to buy out the Fox stakes, although no deal has been announced. Fox increased its interest in YES to 80% in 2014, a stake now valued at about $4 billion today.  In the event of a sale, the Yankees have the right to buy back the stake from Fox, but there has been no indication that right has been exercised yet.

Finding suitors for the other RSNs could be harder. While live sports still draws in strong ratings, RSNs have lost some of their luster as the fees they charge pay TV distributors to carry them have soared. 

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