Comcast making move to prevent Disney deal for 21st Century Fox assets


The cable giant, which owns NBCUniversal, had in December bowed out of the bidding process just before Fox accepted the Disney deal, which includes the 20th Century Fox movie and TV studio, all the global pay TV properties including its stake in Sky, as well as a number of other assets.

On Wednesday, Comcast confirmed it is "in advanced stages" to prepare a superior "all-cash" offer for most of the assets of 21st Century Fox - in a move to block Disney's $52.4 billion offer.

"While no final decision has been made", the telecommunication conglomerate said in a statement, "at this point the work to finance the all-cash offer and make the key regulatory filings is well advanced".

That agreement also covers the intended purchase of the 39.1% stake in Sky, the owner of Sky News, that Fox now owns.

Comcast is putting cash on the table to stop Disney's deal with Fox.

To be clear, though, Comcast's proposal would not include Fox's other branches, such as their news and business networks.

Murdoch has sought full control of Sky but has faced opposition from regulators in Britain.

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Comcast won approval on Monday from the United Kingdom government to move ahead with its offer for Sky. Some reports said Murdoch had previously rejected an offer from Comcast.

Comcast chairman and CEO Brian Roberts recently emphasized that the company would only bid for assets that would make financial and strategic sense to buy, but the cable giant's stock has been hit by investor fears about increased debt levels and the risks of a bidding war. Fox will spin off the Fox Broadcasting network and local stations, Fox News, Fox Business Network, FS1, FS2 and Big Ten Network into a new company, called New Fox.

"While a Comcast acquisition of Fox is surely challenging financially, Comcast has never shied away from a challenge", the analyst wrote.

However, analysts believe such tie ups will face close scrutiny from U.S. regulators who fear consolidation could drive up prices for consumers.

Further complicating things here is the fact that Comcast is now in a bidding war for Sky. Disney would also take ownership of a number of Fox's pay-TV channels including FX and National Geographic.

The move comes with Murdoch gradually withdrawing from the empire he built, giving more authority to his sons Lachlan and James.

A counterbid would roil a plan by Disney Chief Executive Officer Bob Iger to bolster the company's dominance in entertainment. Comcast is not expected to make a formal offer until after the AT&T/Time Warner case is decided. Moreover, as cord cutting grows in the United States, and consumer media consumption habits change, the market will continue to see more big deals that strive to insulate players from industry disruption.