Posted In: National Television
Updates on Comcast Role in the Fox deal.
Update COmcast to sell its shares in Hulu for Fox Assets.
Here is another take on the bid for the Fox assets.
Comcast will become one of the most indebted companies in the world, leveraging around $170 billion, if proposed purchases of Sky and 21st Century Fox come to fruition, according to ratings firm Moody’s.
In fact, not counting banks, Comcast would only be surpassed in debt obligation by AT&T, which just paid $85.4 billion for Time Warner Inc. after buying DirecTV for nearly $50 billion. AT&T is carrying close to $250 billion in debt obligations.
“It’s an unprecedented amount of debt for a company like Comcast,” Cowen analyst Gregory Williams told CNN.
As CNN also noted, Comcast has only around $6 billion on its balance sheet, so it will have to borrow most of the $65 billion needed to purchase Fox. Additionally, it would take on around $20 million in debt from Fox should that acquisition go through.
With the two mergers, Comcast’s debt to income ratio would rise from 2.5 times its annual profit to 4.25 times.
“The willingness to take your leverage up to this level is a bit of a surprise,” Morgan Stanley analyst Ben Swinburne said during a Comcast conference call last week.
Speaking to investors last week to formally announce its attempt to buy out the bulk of Fox assets from under the nose of prospective suitor Disney, Comcast CEO Brian Roberts said paying down debt will become the cable conglomerate’s top priority following the mergers.
“We’re having an excellent quarter, and we’ve had an excellent run for several years,” Roberts said. “We’re confident enough in the company and our prospects that we can take a temporary releveraging and bring us back down.”
For both Comcast and AT&T, the increased scale might very well lead to the kind of profits that pay down the debt quickly—if everything goes to plan.
Update on the Disney/Fox talks.
Here is the latest on the Fox Disney talks where now Disney approves the bid for the Fox assets.
NEW YORK (AP) — The Walt Disney Co. on Wednesday won U.S. antitrust approval for its $71.3 billion bid for Twenty-First Century Fox’s entertainment assets.
Disney must first sell its 22 regional sports networks, the Department of Justice said. The company has 90 days to sell the networks, with an option to extend for another 90 days.
Fox’s assets have been the target of bidding war between Comcast and Disney. Comcast offered nearly $66 billion for Fox’s assets, which include the FX network and the studio that houses the X-Men franchise.
Fox has the option to consider other offers and Comcast could raise its bid.
The battle for Twenty-First Century Fox reflects a new imperative among entertainment and telecommunications firms. They are amassing ever more programming to better compete with companies such as Amazon and Netflix for viewers’ attention — and dollars. The news comes on the heels of AT&T buying Time Warner for $81 billion.
“Today’s settlement will ensure that sports programming competition is preserved in the local markets where Disney and Fox compete for cable and satellite distribution,” said Assistant Attorney General Makan Delrahim of the Justice Department’s antitrust division in a statement.
Now Chris Hohn is negotiating for a COmcast Fox talks
Activist investor Chris Hohn sent a letter this week to 21st Century Fox Chairman Rupert Murdoch and the company’s board, urging the company not to turn away so fast from Comcast’s bid to purchase its entertainment assets.
“We do not know if Comcast will return with a higher offer, but we will be strongly motivated by the deal that offers the highest price and we will encourage other shareholders to do the same,” Hohn wrote in his letter, which was first reported on by Financial Times.
Hohn heads TCI Fund Management Ltd., which is one of Fox’s largest shareholders, controlling a 7.4% stake in the company. His letter was prompted by an SEC filing made by Fox earlier this week, in which the media company justified taking a $71.3 billion cash and stock offer from The Walt Disney Company.
Update on the Disney Fox and Comcast talks.
Another Update on the Comcast Sky and Fox Talks
Sending the ball back across the net, Comcast said it was upping its offer for European pay-TV giant Sky, just hours after 21st Century Fox boosted its own bid.
Comcast put forward its new proposal at an implied value of $34 billion, or £26 billion at £14.75 per share.
“Comcast has long admired Sky and believes it is an outstanding company and a great fit with Comcast,” the company said. “Today’s announcement further underscores Comcast’s belief and its commitment to owning Sky.”
Fox issued a terse, one-sentence statement this evening acknowledging the Philadelphia-based company’s bid, which topped its own $32.5 billion offer earlier in the day.
The move escalates a bidding war that’s playing out across continents. Comcast is said to be preparing a counter-attack in its long-running fight with Disney over Fox’s studio and network assets, though many analysts have increasingly argued that it is an either-or scenario.
Some interpret the Sky offer as as a signal that Comcast is walking away from its bidding war with Disney over Fox’s film and television assets and focusing instead on an asset that would extend its reach in Europe.
For Sky, the giant satellite provider, Comcast said it has committed financing available to satisfy the full cash consideration payable to Sky shareholders. It noted that it has already received relevant regulatory approvals in the EU, Austria, Germany, Italy, and Jersey. Comcast expects to complete the acquisition before the end of October 2018.
Just a couple of hours before the latest offer came through, RBC Capital Markets analyst Steven Cahall issued a research report titled “The Final Countdown?” In it, he looked at the two mega-deals in the final stages of bidding — Sky as well as the Fox assets.
Update on the Fox/Disney talks.
Update on the talks as a shareholders votes comes into play.
Another report on sky’s role in the Disney Fox talks.
- This reply was modified 10 months, 2 weeks ago by Bill Recto.
Here is an update on the fate of Sky in the Disney FOx Talks.
The future of Sky has been up in the air for nearly two years. It could soon be decided in a quick-fire auction.
The European broadcaster has been the subject of an extended takeover fight between Comcast (CMCSA) and 21st Century Fox (FOX) — backed by Disney (DIS), which is in the process of acquiring most of Rupert Murdoch’s entertainment assets.
The episode could soon come to a dramatic close.
If neither suitor gives up before September 22, UK regulators could take the rare step of setting up an auction that will determine which US media heavyweight ends up controlling the coveted broadcaster.
Sky and its 23 million subscribers are attractive assets to US media companies that want to expand their operations to Europe and bolster their defenses against an onslaught from Netflix (NFLX) and Amazon (AMZN).
Comcast is the current higher bidder for Sky, having offered £14.75 ($19.30) per share in July. That compares to Fox’s offer of £14 ($18.30) per share for the 61% of Sky it doesn’t already own.
Sky investors are expecting a higher price to materialize: Shares in Sky were trading at £15.77 ($20.62) in London on Friday, a 46% premium over the £10.75 ($14.05) per share that Fox initially offered back in December 2016.
Investors are holding out for more
By Wednesday, less than 1% of shareholders had accepted the offer from Comcast, despite it having the backing of the Sky board.
The UK Panel on Takeovers and Mergers could now intervene to settle the matter with an auction, a mechanism that has been used only a handful of times in recent decades.
In such a case, the regulator would seek agreement from the parties — Comcast, Fox and Sky — on a framework for the auction, including whether it would be private or public, the number of bidding rounds and whether the companies can offer shares in addition to cash.
The companies have already been discussing the process, Bloomberg reported this week.
If an agreement cannot be reached, the regulator would conduct a five-day auction where each potential buyer is limited to one bid per day. The offers would be made public.
At the end of the week, shareholders would have two final bids to choose between.
Comcast and 21st Century Fox declined to comment.
The auction would bring to an end a dramatic period for the media industry which saw Comcast and Disney go head to head for control of 21st Century Fox, a battle that at times appeared to be personal for Comcast CEO Brian Roberts and Disney CEO Bob Iger.
Update on the Disney Fox Deal and it includes the Comcast Bid on Sky.
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