Disney chairman-CEO Bob Iger didn’t mince words Wednesday morning as he sized up his company’s chances of securing regulatory approval for the acquisition of major 21st Century Fox assets compared to rival bidder Comcast.
Iger cited Comcast’s sizable footprint as a broadband provider as a red flag for regulators during a half-hour conference call with Wall Street analysts held after Disney unveiled its sweetened offer for Fox. Disney’s bid for the 20th Century Fox studio, FX Networks, National Geographic Partners and other assets has ballooned, under pressure from Comcast’s aggressive bid, from $52.4 billion, as set in December, to $71.3 billion.
Iger questioned Comcast’s reasoning in citing AT&T’s victory in the anti-trust trial over its acquisition of Time Warner as clearing a regulatory path for the cable giant to buy the Fox assets. He said the AT&T case didn’t deal with the broadband component that tends to be more heavily regulated than film and TV content and distribution assets.
Iger noted that the recent restructuring of Disney’s top management hierarchy — elevating Kevin Mayer to chairman of direct-to-consumer and international and Bob Chapek to head of consumer products, experiences and parks — was done “specifically with the idea of moving many of these (Fox) executives into key roles at the Walt Disney Company.”
“We’re very comfortable with this level of leverage ,” McCarthy said. “We’ve always said we would be willing to deploy our balance sheet to advance our strategic objectives.”
The rationale for the Fox acquisition has only grown strong in the six months since the initial transaction jolted Hollywood and set the stage of a fresh round of consolidation of media and content companies. Disney’s pursuit of Fox is all about bulking up its library and content creation pipelines in order to service new direct-to-consumer services that Disney hopes to roll out globally starting next year.
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