Comcast Corp. on June 13 formally made an all-cash offer to acquire select 21st Century Fox Inc. media assets, citing a judge's approval of AT&T Inc.'s purchase of Time Warner Inc. and Fox's upcoming shareholder meeting as the rationale for making the offer now.
The cable operator said it sent a letter to 21st Century Fox's board outlining a "superior proposal" for the assets Fox previously agreed to sell to Walt Disney Co. Under the terms of the new offer, Comcast would pay $35 per share in cash, which represents a premium of about 19% to the value of Disney's all-stock offer as of 12 p.m. ET on June 13.
Disney and Fox in late 2017 struck a $52.4 billion all-stock deal, with Fox shareholders set to receive 0.2745 Disney share for each 21st Century Fox share they own. The transaction includes 21st Century Fox's movie and TV studios, the FX Networks, National Geographic Channel, Fox Networks International and 22 regional sports networks. Additionally, the pair's agreement would give Disney Fox's stake and a controlling interest in streaming service Hulu LLC. Comcast also previously made a formal offer for British satellite giant Sky PLC, 39% of which is owned by 21st Century Fox.
The Disney deal and the Comcast deal do not include the FOX (US) broadcasting network and stations, FOX News Channel (US), FOX Business Network (US), FOX Sports 1 (US), FOX Sports 2 (US) and Big Ten Network.
Comcast's bid comes one day after a U.S. district court judge ruled in favor of allowing AT&T's acquisition of Time Warner, a deal that had been roundly opposed by the U.S. Department of Justice. Noting the DOJ's recent loss, Comcast said in its letter to Fox that it is "highly confident" its proposed transaction will obtain "all necessary regulatory approvals in a timely manner."
Accordingly, Comcast is offering the same regulatory commitments as the ones 21st Century Fox previously obtained from Disney, including a $2.5 billion reverse termination fee. "We welcome the opportunity to discuss the regulatory issues presented by each deal," Comcast said, adding that it does not expect any meaningful difference between the timing of a U.S. antitrust review for a Comcast or Disney transaction.
Fox has scheduled its shareholder vote on the Disney merger proposal for July 10. 21st Century Fox confirmed June 13 that it received Comcast's offer, saying it will carefully review and consider the proposal. Additionally, the company said it has not yet determined whether it will postpone or adjourn its July 10 special meeting of stockholders.