Disney and Comcast have been involved in a major business battle over the purchasing of 21st Century Fox and while the fight isn't over, Disney just received a major win that makes it look like it may eventually come out on top. The Justice Department has given its approval of the purchase, meaning the U.S. government won't fight the deal in court on antitrust grounds. While Comcast could still try to make a move to take the deal away from Disney, the fact is that a Disney/Fox is looking much more likely today.
The Fox board is set to meet in July to discuss the potential sale options and the fact that the Justice Department has already given approval to a purchase by Disney will likely go a long way in helping make a decision. If the government had waited to give its approval then the Fox board would have to pick one of two options that were both only potentials. Now, one of them is a sure thing. Even if Comcast makes the decision to up its bid for Fox and Comcast offer more than Disney once again, that deal would require its own government approval. Fox would have the choice between the guaranteed money from Disney or the potential of more money from Comcast, with the possibility that deal could be killed by the Justice Department.
Comcast likely believes that it would get government approval as well, eventually. The cable giant waited to make the offer for Fox in the first place until the merger between Time Warner and AT&T was given the go-ahead, believing that decision would be an indicator of how things would go for Comcast here. The Justice Department was actually against that merger, though a federal court eventually ruled in favor of it. Since a Comcast deal is expected to come with more regulatory oversight, Comcast would need to up its bid significantly in order to make the additional work be worthwhile.
There was one caveat to the Justice Department's approval of the Disney purchase. Disney has agreed to divest itself of Fox's chain of regional sports channels that are part of the package Disney is looking to buy. Since Disney already owns ESPN the Justice Department felt that owning these channels in major markets along with the primary sports cable channel in the U.S. would have given the company a de facto monopoly on television sports.
Disney's current offer for Fox is $71.3 billion, up from $52.4 billion in order to counter a $65 billion bid from Comcast. Now we'll have to wait and see if Comcast decides to up its bid. The Wall Street Journal is reporting that Comcast is looking for private equity investors to do just that, so this fight certainly isn't over yet. CinemaBlend will continue to follow this closely until a decision is finally made.
