In a deal that makes the bidding war for the Dancing Goddess look like two tourists haggling over a pair of knock-off trainers, Disney have upped the ante with a monster bid for 21st Century Fox, bringing the merger of these two monolithic companies even closer.
The Wall Street Journal takes a closer look at the numbers and the implications.
Walt Disney Co. raised its offer to purchase most of 21st Century Fox FOX 6.42% to more than $70 billion in cash and stock, topping an unsolicited offer from rival Comcast Corp. as the bidding war for the coveted media properties escalates.
Disney’s new offer is far higher than the price of its original deal, $52.4 billion in stock, and surpasses Comcast’s all-cash offer of roughly $65 billion. Disney will pay Fox shareholders roughly 50% in cash and 50% in stock.
Fox, in a news release, said the new Disney deal “is superior to the proposal” made by Comcast earlier this month. Comcast officials were unavailable for comment.
In morning trading, Fox’s class A shares rose 6.2% to $47.47, Disney shares increased 0.8% to $106.98, and Comcast shares added 0.7% to $33.03.
All very positive, but there are plenty of elements to consider.
“But the structure of the offer also matters. More stock in the deal has tax advantages for shareholders. These advantages might be particularly large for Fox shareholders, such as the Murdoch family, who have held Fox’s stock for a long time and thus face a potentially large capital gain to pay taxes on if it is sold for cash. Rupert Murdoch and his family have a 17% economic interest in 21st Century Fox. 21st Century Fox and Wall Street Journal-parent News Corp share common ownership. Disney said the stock part of the deal is expected to be tax-free to 21st Century Fox shareholders.”
As ever, we wait….
