Disney Sweetens Fox Offer to $70 Billion

Cash, stock bid 'superior' to Comcast offer
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Bob Iger and Rupert Murdoch, December 2017, Disney-21st Century Fox deal

Bob Iger and Rupert Murdoch

Just hours before its board of directors was slated to mull over a $65 billion offer from Comcast at a scheduled meeting, 21st Century Fox said it has received a sweetened $70 billion cash and stock bid from The Walt Disney Co. that is "superior" to the Comcast offer.

Disney had agreed to purchase certain Fox assets in December in an all-stock deal that worth about $55 billion, not including debt. Last week, Comcast launched a formal offer for the assets -- including its cable channels FX, FXX and National Geographic, TV and movie production studio 21st Century Fox, regional sports networks, and its interests in U.K. satellite company Sky and online video pioneer Hulu -- valued at about $65 billion.   

Related: Disney Pulls Fox Trigger

The new Disney bid, which is likely to receive a response from Comcast, includes a cash component and is valued at $38 per share, or $71.3 billion (vs. $35 per share or $65 billion for the Comcast bid).

Comcast declined to comment.

An added difference to the new Disney offer: shareholders can opt to take a cash and stock deal subject to a 50% cash and 50% stock pro-ration. 

“The acquisition of 21st Century Fox will bring significant financial value to the shareholders of both companies, and after six months of integration planning we’re even more enthusiastic and confident in the strategic fit of the assets and the talent at Fox,” Disney chairman and CEO Bob Iger said in a statement. “At a time of dynamic change in the entertainment industry, the combination of Disney’s and Fox’s unparalleled collection of businesses and franchises will allow us to create more appealing high-quality content, expand our direct-to-consumer offerings and international presence, and deliver more personalized and compelling entertainment experiences to meet growing consumer demand around the world.”

In a statement Fox said the new Disney offer is a "significant" premium to its earlier proposal and is "superior" to the Comcast bid.

Related: The Hunt is On

“We are extremely proud of the businesses we have built at 21st Century Fox, and firmly believe that this combination with Disney will unlock even more value for shareholders as the new Disney continues to set the pace at a dynamic time for our industry,” said 21st Century Fox executive chair Rupert Murdoch in a statement. “We remain convinced that the combination of 21CF‘s iconic assets, brands and franchises with Disney‘s will create one of the greatest, most innovative companies in the world.“

Fox continued in its statement that its board has not concluded that the Comcast offer could be considered a "company superior proposal" to the Disney agreement. But it also kept the door open for Comcast to sweeten its bid.

"...[T]he amended and restated Disney Merger Agreement contains no changes to the provisions relating to the Company’s directors’ ability to evaluate a competing proposal," Fox said in its statement.

Now the ball is in Comcast's court.

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