Comcast offers $65B for Fox entertainment businesses

Updated June 13, 2018 - 2:52 pm

NEW YORK — Comcast made a $65 billion bid Wednesday for Fox’s entertainment businesses, setting up a battle with Disney to become the next mega-media company.

The bid comes just a day after a federal judge cleared AT&T’s takeover of Time Warner and rejected the government’s argument that it would hurt competition in cable and satellite TV and jack up costs to consumers for streaming TV and movies. The ruling signaled that Comcastcould win regulatory approval, too; its bid for Fox shares many similarities with the AT&T-Time Warner deal.

Comcast says its cash bid is 19 percent higher than the value of Disney offer as of Wednesday. The Wall Street Journal and others reported earlier that Comcast had lined up $60 billion in cash to challenge Disney for media mogul Rupert Murdoch’s company. Disney’s offer was for $52.5 billion when it was made in December, though the final value will depend on the stock price at the closing.

“This is a golden offer that will put considerable pressure on (Disney CEO Bob) Iger and Disney to step up their game on another bid,” GBH Insights analyst Dan Ives said. “This is even higher than the Street thought, which speaks to Comcast really wanting these key assets.”

The battle for Twenty-First Century Fox comes as traditional entertainment companies try to amass more content to compete better with technology companies such as Amazon and Netflix for viewers’ attention — and dollars.

If the Comcast bid succeeds, a major cable distributor would control even more channels on its lineup and those of its rivals. That could lead to higher cable bills or make it more difficult for online alternatives to emerge, though there is not yet evidence of either happening following other mergers. For Disney, a successful Comcast bid could make Disney’s planned streaming service less attractive, without the Fox video.

Content is becoming more important as ways to deliver content proliferate. Cable companies like Comcast are no longer competing only with satellite alternatives such as DirecTV, but also stand-alone services such as Netflix and cable-like online bundles through Sony, AT&T and others.

Disney already started its own sports streaming service and plans an entertainment-focused one late next year featuring movies and shows from its own studios, which include Marvel, Pixar and “Star Wars” creator Lucasfilm.

With the Fox deal, Disney would get more content for those services — through the studios behind the Avatar movies, “The Simpsons” and “Modern Family,” along with National Geographic. Marvel would get back the characters previously licensed to Fox, reuniting X-Men with the Avengers.

Comcast, meanwhile, has been leading the way in marrying pipes with the entertainment that flows through them. It bought NBCUniversal’s cable channels and movie studio in 2013 and added Dreamworks Animation in 2016.

The Philadelphia company has been tinkering with the traditional cable bundle, offering stand-alone subscriptions for some types of video along with smaller bundles of cable channels delivered over the internet. Comcast has said it will add Netflix to some cable bundles.

With Fox, Comcast would expand a portfolio that already includes U.S. television rights to the Olympics and comedy offerings such as “Saturday Night Live.” Comcast already owns such cable channels as CNBC, Bravo and SyFy.

Whichever company prevails would also control Fox’s cable and international TV businesses. That’s key for Comcast, which currently doesn’t have an international presence. The Fox television network and some cable channels including Fox News and Fox Business Network would stay with Murdoch’s family under either deal, as with the newspaper and book businesses under a separate company, News Corp.

Fox shareholders are set to vote on the Disney bid on July 10. Despite Comcast’s higher offer, it’s not immediately clear whether Fox’s board would entertain it. According to regulatory filings, an unnamed company, widely thought to be Comcast, previously made an offer for Fox. But Fox went with Disney because of concerns it would face more regulatory scrutiny with the other company.

That was before U.S. District Judge Richard Leon ruled in AT&T’s favor and rejected the government’s argument that its takeover of Time Warner would hurt competition in pay TV and cost consumers hundreds of millions of dollars more to stream TV and movies. The government worried that AT&T, as DirecTV’s owner, could charge Comcast and other rival distributors higher prices for Time Warner channels like CNN or HBO. In turn, that could drive up what consumers pay. AT&T and Time Warner argue they’re simply trying to stay afloat in the new streaming environment.

Disney wouldn’t face the same issues because it isn’t a television distributor as the way Comcast and AT&T are. But if Disney gets Fox, the combined movie studios would account for 45 percent of worldwide box office revenue, according to BTIG analyst Richard Greenfield. That could raise regulatory objections. A larger studio could use its power to keep its movies in more theaters longer, dampening competition from rival studios.

Disney and Comcast had already been at battle in the U.K. over Sky TV. Fox has a 39 percent stake in that company and has been trying to buy outright, with the intention of selling the full company to Disney as part of that deal. U.K. regulators have given the OK to that offer if Fox sells Sky News. Regulators there also have cleared Comcast’s $30.7 billion offer for the 61 percent of Sky that Murdoch doesn’t own.

In addition to the $35-per-share cash offer, Comcast agreed to pay a $2.5 billion termination fee if the deal doesn’t pass regulatory muster. It also agreed to reimburse Fox for the $1.5 billion-plus break-up fee it agreed to pay to Disney if their deal doesn’t go through.

Disney and Fox did not immediately respond to a request for comment.

ad-high_impact_4
Business
Bellagio, MGM Resorts International’s luxury hotel turns 20
The more than 3,000-room Bellagio hotel is situated on the site of the former Dunes Hotel. The Dunes was imploded in 1993, and construction of the Bellagio started in 1996. It cost $1.6 billion to build, making it the most expensive hotel in the world at the time. The Bellagio was former Wynn Resorts Ltd. Chairman and CEO Steve Wynn’s second major casino on the Strip after The Mirage. MGM Resorts International acquired the property from Steve Wynn in 2000. (Tara Mack/Las Vegas Review-Journal)
Facial recognition software at G2E – Todd Prince
Shing Tao, CEO of Las Vegas-based Remark Holdings, talks about his facial recognition product. (Todd Prince/Las Vegas Review-Journal)
Former NBA player, Shaquille O'Neal, speaks about his new Las Vegas chicken restaurant
Former NBA player, Shaquille O'Neal, speaks about his new Las Vegas chicken restaurant. Bizuayehu Tesfaye/Las Vegas Review-Journal @bizutesfaye
Bobby Baldwin to leave MGM
MGM Resorts International executive and professional poker player Bobby Baldwin is set to leave MGM.
Caesars has new armed emergency response teams
Caesars Entertainment Corp. has created armed emergency response teams. They are composed of former military and law enforcement officials. "These teams provide valuable additional security capabilities,” Caesars spokeswoman Jennifer Forkish said. Caesars is hiring Security Saturation Team supervisors, managers and officers, according to LinkedIn. The company did not say how many people it plans to hire for the units. (Las Vegas Review-Journal)
Las Vegas, airlines prepare for CES
CES in January is expected to attract more than 180,000 attendees. (Las Vegas Review-Journal)
AGS partners with Vegas Golden Knights
AGS is the nation’s second-largest manufacturer of Class II slot machines used primarily in tribal jurisdictions. It announced a marketing partnership with the Vegas Golden Knights NHL team. (Las Vegas Review-Journal)
Lehman Brothers bet big on Las Vegas
Lehman Brothers collapsed 10 years ago, helping send the country into the Great Recession.
Fremont9 opens downtown
Fremont9 apartment complex has opened in downtown Las Vegas. (Marcus Villagran/Las Vegas Review-Journal) @marcusvillagran
Ross & Snow launches in Las Vegas
Luxury shoe brand Ross & Snow has opened in Las Vegas, featuring "functional luxury" with premium shearling footwear. (Bailey Schulz/Las Vegas Review-Journal)
Remote Identification and Drones
DJI vice president of policy and public affairs discusses using remote identification on drones. (Bailey Schulz/Las Vegas Review-Journal)
Drones and public safety in Nevada
Two representatives in the drone industry discuss UAV's impact on public safety. (Bailey Schulz/Las Vegas Review-Journal)
Frontier Airlines to launch flights from Las Vegas to Mexico
Frontier, a Denver-based ultra-low-cost carrier, will become the first airline in more than a decade to offer international service to Canada and Mexico from Las Vegas when flights to Cancun and Los Cabos begin Dec. 15. (Rick Velotta/Las Vegas Review-Journal)
MGM Resorts International CEO Jim Murren addresses Oct. 1 lawsuits
MGM Resorts International Chairman and CEO Jim Murren addresses criticism his company has received for filing a lawsuit against the survivors of the Oct. 1 shooting. (K.M. Cannon/Las Vegas Review-Journal)
MGM Resorts International opens the doors on MGM Springfield
Massachusetts’ first hotel-casino opens in downtown Springfield. The $960 million MGM Springfield has 252 rooms and 125,000-square-feet of casino. (K.M. Cannon/Las Vegas Review-Journal)
MGM Resorts International prepares to open MGM Springfield
Las Vegas-based MGM Resorts International gave news media and invited guests a preview of the $960 million MGM Springfield casino in Massachusetts. The commonwealth's first resort casino will open Friday, Aug. 24. (K.M. Cannon/Las Vegas Review-Journal)
A Walk Through Circus Circus
It only takes a short walk through Circus Circus to realize it attracts a demographic like no other casino on the Strip: families with young children. (Todd Prince/Las Vegas Review-Journal)
Morphy Auctions, a vintage slot machines seller, wants gaming license
Vice president Don Grimmer talks about Morphy Auctions at the company's warehouse located at 4520 Arville Street in Las Vegas on Thursday, Aug. 16, 2018. (Rick Velotta/Las Vegas Review-Journal)
Nevada's venture capital money doesn't stay in state
Zach Miles, associate vice president for economic development for UNLV, said there’s venture money in Southern Nevada, “but trying to find the right groups to tap into for that money is different.” According to a 2017 report from the Kauffman Foundation, Las Vegas ranked number 34 out of 40 metropolitan areas for growth entrepreneurship, a metric of how much startups grow. With a lack of growing startups in Las Vegas, investment money is being sent outside of state borders. The southwest region of the U.S. received $386 million in funding in the second quarter, with about $25.2 million in Nevada. The San Francisco area alone received about $5.6 billion. (source: CB Insights)
Neon wraps can light up the night for advertising
Vinyl wrap company 5150 Wraps talks about neon wraps, a new technology that the company believes can boost advertising at night. (Marcus Villagran/Las Vegas Review-Journal) @brokejournalist
Nevada on the forefront of drone safety
Dr. Chris Walach, senior director of Nevada Institute for Autonomous Systems, talks to a reporter at NIAS's new Nevada Drone Center for Excellence of Public Safety, located inside the Switch Innevation Center in Las Vegas. K.M. Cannon Las Vegas Review-Journal @KMCannonPhoto
Motel 8 on south Strip will become site of hotel-casino
Israeli hoteliers Asher Gabay and Benny Zerah bought Motel 8 on the south Strip for $7.4 million, records show. They plan to bulldoze the property and build a hotel-casino. Motel 8 was built in the 1960s and used to be one of several roadside inns on what's now the south Strip. But it looks out of place today, dwarfed by the towering Mandalay Bay right across the street.
Entertainment
Nevada Ballet Theatre rehearses for "Dracula" at The Smith Center
Nevada Ballet Theatre rehearses for "Dracula" at The Smith Center (Janna Karel/ Las Vegas Review-Journal)
Downtown Summerlin hosts its annual Festival of Arts
People crowd to Downtown Summerlin for the 23rd annual Summerlin Festival of Arts in Las Vegas, Sunday, Oct. 14, 2018. (Caroline Brehman/Las Vegas Review-Journal)
Bellagio, MGM Resorts International’s luxury hotel turns 20
The more than 3,000-room Bellagio hotel is situated on the site of the former Dunes Hotel. The Dunes was imploded in 1993, and construction of the Bellagio started in 1996. It cost $1.6 billion to build, making it the most expensive hotel in the world at the time. The Bellagio was former Wynn Resorts Ltd. Chairman and CEO Steve Wynn’s second major casino on the Strip after The Mirage. MGM Resorts International acquired the property from Steve Wynn in 2000. (Tara Mack/Las Vegas Review-Journal)
Recycled Art and Cute Dogs at Summerlin Festival Of Arts
Recycled Art, Cute Dogs Abound At Summerlin Festival Of Arts (Janna Karel Las Vegas Review-Journal)
Bellagio Patisserie Creates Life-size Sculpture Of 20th Anniversary Of Cirque Du Soleil Show
Bellagio Patisserie Creates Life-size Sculpture Of 20th Anniversary Of Cirque Du Soleil Show (Janna Karel/Las Vegas Review-Journal)
10 Most Iconic Moments At The Bellagio Fountains
10 Most Iconic Moments At The Bellagio Fountains (Janna Karel/Las Vegas Review-Journal)
Jason Aldean talks about the possibility of a Las Vegas residency
Country superstar Jason Aldean discusses his feelings about playing in Las Vegas and says he'd be interested in a Las Vegas residency when the time is right at the iHeart Radio Music Festival in Las Vegas on September 21, 2018.(John Katsilometes/Las Vegas Review-Journal)
Block 16 Urban Food Hall Serves Favorite Foods From Across The US
Block 16 Urban Food Hall Serves Favorite Foods From Across The US (Janna Karel Las Vegas Review-Journal)
Benny the Skating Dog could be the next Golden Knights on-ice entertainment
Benny the Skating Dog could be the next Golden Knights on-ice entertainment (Janna Karel Las Vegas Review-Journal)
Who To Watch At Life Is Beautiful
Life Is Beautiful Setup
Workers preparing Fremont street for this weekend's Life is Beautiful festival, on Wednesday, September 19, 2018. Mat Luschek/Las Vegas Review-Journal
The 46th annual Greek Food Festival will feed 25,000 people in Las Vegas
Madame Tussauds Has The Newest VR Experience On The Strip
Madame Tussauds Has The Newest VR Experience On The Strip. (Janna Karel Las Vegas Review-Journal)
Zia Records Move
Zias Records is moving from its Sahara Avenue and Arville Street location to a bigger store. (Mat Luscheck/Las Vegas Review-Journal)
Students At The International Contortion Convention In Las Vegas Learn How To Bend And Twist Their Bodies
Students At The International Contortion Convention In Las Vegas Learn How To Bend And Twist Their Bodies. (Janna Karel Las Vegas Review-Journal)
Video from Fertitta wedding Sep. 1
video from @wedstagrams of Fertitta wedding at Red Rock Resort
You Can Get Vegan Unicorn Toast In Downtown Las Vegas
You Can Get Vegan Unicorn Toast In Downtown Las Vegas (Janna Karel Las Vegas Review-Journal)
Five must-see bands at Psycho Las Vegas 2018
Five must-see bands at Psycho Las Vegas 2018
Zuma's Ice Cube Carving Is Satisfying To Watch
Zuma's Ice Cube Carving Is Satisfying To Watch (Janna Karel Las Vegas Review-Journal)
Therapy In Downtown Las Vegas Serves Cast Iron S'mores
Therapy In Downtown Las Vegas Serves Cast Iron S'mores. (Janna Karel Las Vegas Review-Journal)
TOP NEWS
News Headlines
Add Event
Home Front Page Footer Listing
Circular
You May Like

You May Like