Acquisition: Disney Agrees To Sell Off 21st Century Fox’s Sports Network
American entertainment conglomerate, Walt Disney Company, has agreed to sell off 21st Century Fox’s 22 sports network, the only stumbling block to its acquisition of the media company.
The Justice Department had, on Wednesday, told the Federal court that this was the only caveat that it needed to do to be able to approve the acquisition of Rupert Murdoch’s TV empire but Disney released a statement saying that it is willing to resolve the “limited potential concerns”.
The $71.3 billion deal has placed the conglomerate ahead of COMCAST, its competitor.
Before Disney’s amount increase of the deal, COMCAST had explained intentions of securing the regulatory approval for $65 billion while Disney’s stood at $52.4 billion as at December 14. FOX’s board went back to the drawing board and had deliberations due to COMCAST’s regulatory approval before arriving at a decision.
As a result, the SEC filing reads
“21CF management noted that Disney’s (June 20) proposal, as compared to Comcast’s, provided for higher nominal value, enhanced opportunity for value appreciation through its stock component, certainty of value through its collar mechanism, the opportunity for stockholders to elect cash or stock consideration, as well as certain enhancements to the existing merger agreement’s allocation of regulatory risk”
“Comcast’s proposed contractual allocation of regulatory risk, which merely matched the regulatory efforts and reverse termination fee provisions in the original combination merger agreement and did not offer enhanced protections to address the higher regulatory risk posed by a transaction with Comcast”.