Fox held talks to sell most of company to Disney

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Rupert Murdoch’s Twenty-First Century Fox has held talks to sell most of its film and television assets to Walt Disney Co, which would gain new programming and expand its international reach.

The two sides are not currently talking, but had held talks in the last few weeks, CNBC reported Monday, citing unidentified people familiar with the matter.

The discussions reflect a view among Fox executives that the media company could not reach the size needed to compete with Amazon.com Inc, Netflix Inc and other major media players, according to CNBC.

Representatives of Disney and Fox had no comment.

For Disney, a deal could bring additional programming it could use to lure audiences as the company tries to navigate consumers’ rapid migration to digital viewing and compete with heavy spending by technology companies pushing further into Hollywood. It also could extend Disney’s reach into international markets.

Disney, which under US rules could not own two broadcast networks, would not purchase all of Fox, according to the reports. It would not seek to buy Fox’s sports programming assets for fear of running afoul of antitrust laws with its own ESPN network, and also would not buy Fox News or Fox’s broadcast network or local broadcasting affiliates, the report said.

It did discuss buying Fox’s movie and TV production studios, cable networks FX and National Geographic and international assets such as the Star network in India and European pay TV provider Sky Plc, CNBC said.

Reuters Photo

Fox’s shares jumped 9.9 percent to close at 27.45 US dollars on Nasdaq, and Disney shares climbed 2.0 percent to 100.64 US dollars on the New York Stock Exchange.

Credit Suisse analysts said the talks increase uncertainty around the Sky transaction. Disney may want Sky as part of an international streaming strategy, but a deal also would deepen its exposure to traditional businesses that have been under pressure.

Chief Executive Bob Iger has said he plans to retire from Disney in July 2019, and the company is searching for a successor.

Fox and Disney are co-owners of Hulu, a streaming service that offers on-demand and live TV packages. Hulu also is partially owned by Comcast Corp and Time Warner Inc.

Source(s): Reuters