Putting the pressure on rival media conglomerate Comcast, Disney’s $71 billion cash and stock bid is still to clear several regulatory hurdles.
The U.S. Department of Justice has approved Disney’s $71 billion bid for 21st Century Fox, The Los Angeles Times reports, with the caveat that the deal exclude Fox’s regional sports networks.
That exclusion, which is due to separate monopoly concerns related to ESPN, will require that Disney sell the Fox Sports Regional Networks within 90 days from the date of closing the transaction (with a possible three-month extension), but still leaves Fox’s other entertainment assets on the table, including its significant television and feature film businesses.
While the potential deal still reportedly faces a number of other regulatory hurdles, per Deadline the DOJ decision will force rival media conglomerate Comcast to sweeten its previous offer of $65 billion in cash for Fox’s assets:
“The news still puts pressure on Comcast to respond to Disney’s offer, which sources have indicated it is trying to do. The two companies have been competing for the Fox studio and network assets, with Comcast reportedly trying to line up outside funding sources with the sense that the bidding could reach the $90 billion range.”
Calling the DOJ ruling a “victory” for Disney in its battle with Comcast, the LA Times notes that “The $38-a-share price is about $10 a share higher than what Disney offered in December -- and $3 above Comcast’s bid.”