Disney Moves From Behemoth to Colossus With Closing of Fox Deal

Share With Your Friends
Facebook
Twitter
Pinterest
LinkedIn


The challenges are daunting. Mr. Iger and his lieutenants need to persuade investors to start viewing Disney more like a technology company, where near-term financial turbulence is often overlooked. Integrating the Fox assets will bring headaches that include substantial layoffs — analysts project more than 3,000 — and the melding of two starkly different corporate cultures. When the deal was announced in December 2017, James L. Brooks, a creator of “The Simpsons,” posted an image on Twitter that showed an angry Homer Simpson strangling Mickey Mouse.

To win approval from antitrust regulators around the world, Disney had to agree to modest concessions.

It is already deep in the process of selling Fox’s 22 regional sports channels, a move required by the Justice Department. The Yankees teamed with Amazon this month, for instance, to buy the YES Network, which serves the New York metropolitan area, for roughly $3.5 billion. To appease European regulators, Disney agreed to divest a stake in A+E Networks, which include the History channel. (Disney will retain 50 percent ownership of the division in the United States; Hearst owns the other half.)

The final sticking points came from Brazil and Mexico. Regulators in those countries are forcing Disney to sell Fox Sports, a competitor to ESPN that holds extensive rights to televise soccer matches. Brazil’s antitrust regulator, Cade, said in a statement that operating both channels would give Disney too much control of the sports TV market in the country. Mexico’s telecommunications regulator, IFT, held a similar view and added stipulations about Disney’s ownership of the National Geographic and Nat Geo Wild channels.

At Disney’s annual meeting this month, Mr. Iger said the 20th Century Fox and Fox Searchlight labels — trumpet fanfares included — would continue to exist. That decision pleased Hollywood, but it could lead to consumer confusion since Mr. Murdoch retained ownership of the Fox broadcast network, a chain of local Fox television stations and his crown jewel, Fox News. Those businesses, along with the FS1 sports channel, were rolled into a new publicly traded company, Fox Corporation, on Tuesday.

Paul D. Ryan, the former Republican congressman from Wisconsin who served as speaker of the House from October 2015 to January 2019, joined the Fox board on Tuesday. Other board members include Mr. Murdoch and Roland A. Hernandez, a former chief executive of Telemundo. Mr. Murdoch’s oldest son, Lachlan, serves as the new company’s chief executive.

The Murdochs are expected to receive roughly $12 billion in proceeds from the Disney deal, according to Bloomberg. Shareholders in the assets that were sold to Disney had the option to accept Disney shares or cash out. Disney said on Friday that, based on initial results of that process, holders of about 52 percent of shares asked for cash and 37 percent asked for Disney shares. The balance did not make a request.






Source link

Share With Your Friends
Facebook
Twitter
Pinterest
LinkedIn