Disney raises its bid for Fox to $71 billion

Disney raises its bid for Fox to $71 billion

Disney raises its bid for Fox to $71 billion

The improved offer came as 21st Century Fox board was set to decide whether to back Comcast's bid for assets that include Fox's film and television studios and worldwide businesses. Comcast countered last week with a $35-per-share all-cash offer, valued at $65.7 billion based on the same number of shares. Disney's first bid of $51 billion in stock options was approved by Fox shareholders earlier this year. Fox will have to pay Disney a $1.5 billion breakup fee if it backs out of that deal. All of a sudden, it's like that girl in high school who everyone wants to ask out, as over the course of the past few weeks, the bid to acquire most of its assets has been raised by almost $20 billion.

The bidding war for 21st Century Fox continues.

Disney is locked in a battle with U.S. media conglomerate Comcast, which has offered $65bn in cash for Fox.

In a call with analysts, Iger said he believes Disney's bid is superior to Comcast's from a regulatory perspective, and said that six months of dealing with regulators both in the US and internationally has given Disney a 'meaningful head start'. AT&T just bought Time Warner for $81 billion, after a federal judge rejected the government's antitrust concerns.

When Comcast made its bid for Fox last week, CEO Brian Roberts said in a letter to Murdoch and his sons that he is "highly confident" that Comcast will "obtain all necessary regulatory approvals in a timely manner and that our transaction is as or more likely to receive regulatory approval than the Disney transaction". "We remain convinced that the combination of [Fox's] iconic assets, brands and franchises with Disney's will create one of the greatest, most innovative companies in the world".

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The deal became possible when Murdoch, 87, and his sons chose to slim down their media-entertainment empire, leaving them with the Fox News Channel, the Fox broadcast network and sports cable operations.

In morning trading, shares of 21st Century Fox rallied 6 percent to $47.47. Disney will also assume about $13.8 billion of net debt of 21st Century Fox.

The new cash-or-stock deal may be attractive to Fox's largest shareholder, Rupert Murdoch, who owns 17 percent voting shares along with his family.

Fox said it will postpone its special shareholders meeting in order to provide stockholders with an opportunity to evaluate Disney's amended offer. It's not a one-to-one split: Roughly every four Fox shares would get you one Disney share. The acquisition will occur immediately after the spin-off by 21st Century Fox of the Fox Broadcasting network and stations, Fox News Channel, Fox Business Network, FS1, FS2 and Big Ten Network into a newly listed company referred to as New Fox.

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