As Disney prepares to close its 21st Century Fox deal, there are still some steps they need to take to meet regulators’ requirements. Currently Disney needs to sell its stake in A+E Networks in Europe prior to the close of acquisition.
What’s happening:
- Disney is working to meet regulators’ requirements of selling their stakes in some European cable channels before they finalize the Fox acquisition.
- Currently, Disney is required to sell its stake in A+E Networks’ factual channels in Europe.
- According to reports on Deadline, Disney has been in talks with Hearst—a joint-venture partner in A+E—about a potential buyout. This would include other channels in Europe such as:
- History
- Lifetime
- Crime & Investigation
- While Deadline speculates that Hearst would be a logical buyer, they also note that European analysts have reported a number of rival bidders.
- Discussions with Hearst do not guarantee a deal however, some believe that it would make the most sense for a company already familiar with the networks’ operations to want to purchase them.
- The merger was approved by European regulators who determined combining Fox and Disney’s film studios raised no concerns because the merged company would still face significant competition Sony, Universal, Warner Bros and others.
- As for the television networks, regulators found that the merger “would have eliminated competition between two strong suppliers of ‘factual channels’ in several EEA Member States,” leaving Disney with National Geographic and History channels.
- Neither Hearst nor Disney have commented on any discussions.
What they’re saying:
- Analyst speaking to Deadline: “There are other buyers for the channels as well. It might make sense for [Sky owner] Comcast to buy it out.”
- Guy Bisson, Research Director at Ampere Analysis, speaking to Deadline: “Arguably the thematic channels fit better with the Comcast/Sky approach to the market than the Disney one. It’s interesting that everything is converging to almost push Disney/Fox down a direct-to-consumer route faster than they might otherwise have managed that migration and that includes the regulatory input from the EC on the A+E factual channels.”
Previously:
- Just last week, the EU granted approval of the merger under the condition that Disney sell its stake in A+E Networks.
- Back in September, the EU said that they would announce their decision about the Fox acquisition on October 19.
- During the Q4 2018 Earnings call with shareholders, Disney CEO Bob Iger indicated that they hope to have the acquisition closed by the first quarter of 2019.