Walt Disney Co. is expected to announce the acquisition of a large chunk of 21st Century Fox Inc. on Thursday. The deal is the biggest ever for Disney and a significant milestone in the long career of Australia-born media mogul Rupert Murdoch. Disney will pay $28 to $29 a share in an all-stock deal for Fox businesses including a movie studio, cable channels and international assets, according to a person familiar with the matter. That values the remaining Fox holdings at $11 to $12 a share, the person said. The Wall Street Journal reported the figures earlier Wednesday.
Below are some of the major points of the deal:
What We Know What We Don’t Know $60 billion. That’s the approximate value of the assets being purchased, including debt. How much of Fox’s $12.9 billion in net debt stays with Fox or is assumed by Disney? The Murdochs will control about 5 percent of Disney after the deal. Fox as a whole will get about 25 percent of Disney’s stock as part of the sale. Will all that be distributed to Fox shareholders? The sale includes the 20th Century Fox film business, but not the actual studio backlot. What becomes of that real estate? Will the combined company adopt Disney’s film strategy, which means a lot fewer art-house pictures, such as 2014 Oscar winner “12 Years a Slave,” and more blockbuster sequels like “Avatar?” Much of the deal valuation is based on Fox’s regional sports networks, such as YES, the New York Yankees channel. How will sports leagues, fans and regulators react to ESPN’s owner controlling that much live sports on TV? Disney is acquiring Fox’s 39 percent stake in European TV provider Sky Plc.
How will the deal affect Fox’s pending offer to acquire the rest of that business? With the acquisition of Fox’s 30 percent of U.S. streaming service Hulu, Disney’s share jumps to a majority ownership. How will that change the strategy at one of the strongest competitors to Netflix Inc.? Fox shareholders will be left with Fox News, Fox Business and Fox Sports 1 — essentially the live programming assets — as well as the Fox broadcast network. What will become of Murdoch’s broadcast network when it no longer has a TV studio behind it? Fox CEO James Murdoch could eventually be offered a senior job at Disney. Is there a shot he becomes Disney CEO when Bob Iger ultimately retires?