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The Disney-21st Century Fox deal: a timeline

The Disney-21st Century Fox deal: a timeline


Comcast and Verizon reportedly floated their own offers for the company

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Image: Disney

Yesterday, Disney filed papers with the Securities and Exchange Commission regarding its acquisition of 21st Century Fox in December. The document highlights the details of the acquisition, as well as a timeline that shows off how the talks began. It also reveals that Disney wasn’t the only company interested in acquiring Fox — Verizon and Comcast also came calling.

The SEC filing makes for a dry but at times fascinating read. As it unfolded in the press last November and December, it was clear that there were some ups and downs behind the scenes. The document shows how the complicated deal came together, and how both companies agonized not only over what parts to acquire, but how to do so while avoiding regulators.


Discussions for a merger between the two companies began on August 9th, 2017, when 21st Century executive chairman Rupert Murdoch and Disney CEO Bob Iger met in Los Angeles. (The two have reportedly met “from time to time” to discuss the ups and downs of the media environment and its future.) At some point during this conversation, the idea of a possible “strategic transaction” between the two companies came up.

Days later, 21st Century’s executive chairman Lachlan Murdoch and its CEO James Murdoch met with a third party named in the SEC filing as “Party A.” Variety and Deadline both report Party A was Verizon CEO Lowell McAdam, who also floated the idea of an acquisition. Verizon had already acquired Yahoo the year before, and it has rolled Yahoo and AOL into a new company called Oath.

Two weeks later, Iger and Rupert Murdoch spoke again, and they agreed to begin exploring some sort of acquisition. In early September, 21st Century Fox told Verizon that they weren’t interested unless the company could make them an offer in excess of Fox’s current market valuation, around $45 billion at the time.


For the rest of September, officials from the two companies began working out which parts Disney would acquire 21st Century Fox — the sum of which would be renamed RemainCo — and which parts would be renamed, aptly, New Fox. Iger informed the Disney board at the end of September of their discussions, and they encouraged him to continue.


The two companies continued to talk throughout October, covering the tax implications of such a purchase. In one such meeting on October 25th, Murdoch noted the importance of Iger’s leadership of Disney, adding that his continued leadership would be “a critical element of a successful integration of [21st Century Fox] into Disney.”

Iger has been trying to retire for several years. He first announced in 2015 that he would step down from the role in 2018, but remained on in 2016 after his expected successor, CGO Thomas Staggs, left the company. He then extended his tenure to 2019 in 2017 but said that he meant it. According to an interview in Vogue, Iger had been seriously mulling a run for president; now that has been detailed in the Disney-Fox deal.

Two days later, the companies met once again, this time to discuss the valuation, and Disney said that it was interested in acquiring RemainCo for $60 billion in cash and stock. Unhappy with the quote, Murdoch and 21st Century Fox decided to completely withdraw from acquisition talks.


Word broke on November 6th that Disney had been working to buy Fox. Murdoch told his board about the discussions with Verizon and that Disney’s purchase price was too low. The same day, Murdoch was approached by yet another party, which Variety and Deadline both say was Comcast CEO Brian L. Roberts. [Note: Comcast is an investor in Vox Media, The Verge’s parent company.] Disney also expressed interest in revising its offer in order to resume talks.

Throughout November, representatives from Fox met with Comcast and began their own discussions on how Fox’s businesses would be split up. They also met with Verizon again and indicated that they’d be open to a sale, but “only if it was structured as an all-stock transaction with no meaningful premium to [21st Century Fox] stockholders.”

At the November 15th shareholder’s meeting, Fox’s management team recommended dropping Verizon, and in the following days, they met with representatives from Comcast and Disney to discuss prices. Disney floated a new offer $29.54 a share, which would work out to around $52.3 billion for RemainCo, and that they’d be willing to pay a reverse termination fee in the event that the sale was blocked by regulators, at $2.5 billion.

Comcast made its own offer, which was higher than Disney’s at $34.41 a share, with some strings attached: if regulators took issue with parts of the purchase, those parts would be relegated back to New Fox, rather than sold off, meaning (a) Fox shareholders would be selling off a smaller company, (b) New Fox would be responsible for the first 2 billion in regulatory costs, and (c) it wouldn’t pay a reverse termination fee.

After Thanksgiving, Fox’s board met to compare the various deals before them. Among the things they discussed was the regulatory challenges of a Fox-Comcast acquisition, which were a particular concern as the Department of Justice had sued to block the merger between AT&T and Time Warner just days before. The deal would also be a bit riskier to Fox shareholders, especially if it was forced to downsize its acquisition. The nature of Disney’s business and offer for Fox’s entertainment divisions appears to have been a less risky proposition and would generally be a better fit. The three companies continued their negotiations into early December, but Comcast balked at Fox’s insistence for a reverse termination fee in the event that regulators blocked the sale.


On December 2nd, word broke that Fox and Disney were once again discussing an acquisition. Discussions with Comcast dragged on, but by December 7th, Murdoch informed Roberts that they were suspending discussions, and began to focus on Disney. On the same day, Disney’s board also began to discuss extending Iger’s tenure as CEO of Disney.

Fox’s board met on December 13th to go over the proposals, while Disney’s board met to discuss the purchase and agreed to extend Iger’s position if the purchase went through. The two boards met and agreed to the purchase. Disney would acquire 21st Century’s entertainment assets for $67 billion, while New Fox would hold on to its news and sports brands. Disney announced the sale the next morning: it would acquire Fox’s entertainment division, with the remainder to be spun off into New Fox, which would focus on live sports and news.

The timeline that the document shows two things: the first is that major companies such as Disney, Verizon, and Comcast are hungry for new intellectual property to add to their holdings. Disney has already acquired major properties by buying up Pixar, Marvel, and Lucasfilm, and 21st Century Fox only adds to their coffers, with franchises like Alien, Marvel’s X-Men, and James Cameron’s Avatar.

It also demonstrates how worried these companies are about avoiding incurring the wrath of regulators. Disney’s acquisition of 21st Century Fox’s entertainment divisions makes a certain amount of sense, even if it pushes the company further toward antitrust issues. Both companies are the movie business, and the sale further consolidates some of the bigger brands under Disney’s roof. But for companies like Verizon and Comcast, which are also telecoms, the situation was a bit shakier, and the possibility that Comcast might have to buy a smaller part of Fox in addition to rejecting a termination fee seems to have closed the door on that deal, even though it would have been a higher bid.

In the meantime, the Murdochs have also been working to acquire the remainder of Sky TV in the UK, which would add to its portfolio under its new focus on live sports and news. It’s faced regulatory scrutiny for the deal, and it’s also facing off with giants such as Comcast.