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Comcast Makes a $65 Billion Offer for Twenty-First Century Fox Assets


Comcast (NASDAQ:CMCSA) celebrated a federal judge’s approval for AT&T (NYSE:T) and Time Warner (NYSE:TWX) to merge by finally making a bid for Twenty-First Century Fox Inc. that Wall Street was anticipating the company would do.

Comcat Corp. (NASDAQ:CMCSA) sent an offer to the company on Wednesday, which Twenty-First Century Fox Inc. confirmed receiving, that offered $65 billion for Fox’s movie studios, networks National Geographic and FX, Star TV, and stakes in Sky, Endemol Shine Group and Hulu. Also included in the deal are regional sports networks.

Comcast, the parent of CNBC, has offered shareholders of Fox $35 a share in cash and 100% of the shares the company left behind after the deal.

Compared to Disney’s offer, Comcast’s offer is about 19% higher.

Fox in a statement said it had received the proposal and will review it.

According to Comcast’s Chief Executive, Brian Roberts, he believes regulators will allow the company to acquire most of Fox’s media assets due to the decision made about AT&T and Time Warner Inc.’s merger for $85 billion.

Roberts has said, “These are highly strategic and complementary businesses, and we are in our minds the right buyer.”

He had written a letter to Fox’s board and members of the Murdoch family that read, “We were disappointed when [Fox] decided to enter into a transaction with The Walt Disney Company, even though we had offered a meaningfully higher price.”

He added, “We are pleased to present a new, all-cash proposal that fully addresses the Board’s stated concerns with our prior proposal. One cannot ignore the fact that there’s less independent content to go around,” after the AT&T deal, said Henry Su, an antitrust expert with Constantine Cannon LLP.

“One cannot ignore the fact that there’s less independent content to go around,” remarked Henry Su, an antitrust expert with Constantine Cannon LLP.

“Hulu is the crown jewel in the battle royale for the Fox assets. These assets would fit like a glove for both Disney and Comcast,” chimed in Daniel Ives, chief strategy officer and head of technology research for GBH Insights.

MoffettNathanson analyst Michael Nathanson commented, “As for Disney, this legal outcome was probably the least attractive as it will likely lead to an aggressive counter-bid from Comcast and an absence of heightened regulatory concern from the (21st Century Fox) board. The question is will Disney’s board and management will go to the mat on this transaction. We think the answer’ is ‘yes.'”

If successful, Comcast’s offer for the Fox properties would become the second-largest ever deal in the media sector, according to Dealogic. The first is AOL’s merger with Time Warner back in 2000, which was valued at $94.3 billion excluding debt.

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