The Walt Disney Company has reportedly been looking into buying a portion of Fox News’ parent company, 21st Century Fox.
Fox’s cable TV networks such as FX and National Geographic Channel, the Twentieth Century Fox studio and international distribution operations were reportedly discussed in talks that are no longer on-going, according to the Wall Street Journal, citing “a person close to the discussions.”
Fox News and Fox Business Network were apparently not up for discussion and, since Disney already owns ABC, Fox broadcast would be off the table as well.
According to the Journal:
Acquiring some of Fox’s prized assets would help Disney upgrade its struggling television business, which has been hit by ratings troubles and subscriber declines at networks such as Disney Channel and ESPN. A deal would also give Disney more content for streaming services it plans to launch in the next two years and would significantly increase Disney’s exposure to foreign markets in which Fox has a stronger presence.
Fox wasn’t happy with the terms Disney proposed, but is open to the idea of selling the assets, people familiar with the matter said. Fox for years hasn’t been viewed on Wall Street or in the media industry as an acquisition target because it was run by Mr. Murdoch, who it was thought wanted to hand over the business to his sons, James and Lachlan Murdoch. The Murdochs have a 39% voting stake in 21st Century Fox.
Disney was also reportedly interested in acquiring Fox’s 39 percent stake in Sky, the U.K.-based pay-television giant. Fox had bid $15.5 billion to purchase the rest of Sky but the deal has been held up by the British government, according to the report.
“We see the real strategy here as Fox content helping Disney build out its direct-to-consumer strategy,” RBC Capital Markets analyst Steven Cahill said.
The deal, which is not currently being discussed, “would bolster Disney’s dominance in Hollywood and allow Fox to focus on sports, news and broadcast television,” according to the Journal.
A market analyst on CNBC called the potential deal a “dream come true.”
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