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An empire develops. In separate ballrooms of the Midtown Manhattan Hilton hotel Friday morning, the shareholders of Walt Disney Company and 21st Century Fox have agreed to a $ 71.3 billion purchase plan that Disney gives the essential of the media empire of Rupert Murdoch. the entertainment landscape.
Regulators from more than a dozen countries still have to give their approval. But shareholder votes ended a six-month showdown, conducted on two continents by Disney and Comcast, for supremacy in the rapidly evolving media industry. Mr. Murdoch's treasure represented a unique opportunity to win most of the necessary counter-attack against the technology giants who resolutely settled in Hollywood
"Avatar", the films "X-Men", " Titanic. " "And the TV shows such as" The Simpsons "and" This Is Us "will now be owned by Disney, which adds to an already enviable stock of content from divisions such as Lucasfilm, Marvel Entertainment and Pixar Animation. Studios.The deal also gives Disney the FX and National Geographic cable networks, a majority stake in the Hulu streaming service, which has over 20 million subscribers, and Star, one of the India's Fastest Growing Media Companies.
Some people in Hollywood see the acquisition as the sad end of an era.Disney recognizes that the future of the Television and film is online and this decision could trigger a wave of mergers in the film industry, which has not seen significant consolidation since 1935, when 20th Century Pictures and Fox Film merged to form 20th Century Fox. [19659005] Disney General Manager Robert A. Iger staked his legacy on this case, and to take control of Fox, he had to repel an aggressive piece by Comcast. Mr. Iger and Mr. Murdoch initially agreed on an agreement in December. After months of maneuvering, Comcast, the cable giant in Philadelphia, outpaced Disney's original bid in June, but Mr. Iger returned almost immediately with a much higher bid that combined cash and stock. Mr. Murdoch and the Fox Council quickly agreed.
Comcast called him quits soon and his general manager, Brian L. Roberts, offered a kind of olive-tree by releasing a statement congratulating the two companies. Comcast, however, is still considering competing in a separate deal against Disney for control of European Sky television.
Like the Silicon Valley giants like Netflix, Amazon, Apple and Facebook have sprung into the entertainment world and have attracted a larger audience. The media-guards companies have responded by trying to secure as much gold-plated content as possible. And Disney, for its part, will soon unveil a Netflix-style streaming service to deliver its programs and films directly to viewers.
"One of the most exciting aspects of our Fox acquisition is that it will allow us to greatly accelerate our direct sales strategy to consumers," said Mr. Iger when he said announced the agreement in December. "We believe that creating a direct relationship with consumers is vital for the future of our media companies, and this is our highest priority."
They're not the only ones. A month before Disney closed on Fox, AT & T bought Time Warner, which includes HBO and Warner Bros. Film and TV studios CBS and Viacom have wondered if they should combine, Comcast is likely to play for something else besides trying to win Sky in Europe.Other studios and networks like Discovery, Sony Entertainment, AMC and Lionsgate are looking for # 39, opportunities, and Verizon, Dish and Charter could also explore eventual
"Everyone decided that the future would be owned and distributed." Craig Moffett, a long-time media badyst
At the Disney meeting, shareholders voted on an article: l & rsquo; Disney's final offer was made up of $ 35.7 billion in cash and 343 million shares. approve the issuance of these shares. The meeting lasted nine minutes. Disney said voters controlling 68 percent of the outstanding shares voted by proxy before the meeting. Of these, 99% voted to approve. When Alan N. Braverman, Disney's General Counsel, opened the door to shareholder feedback, a man stood up and whispered, "I think we are paying too much."
Despite the importance of In recent months, Mr. Iger and Mr. Murdoch have not attended shareholder votes. Mr. Iger was already on a trip abroad, and Mr. Murdoch also decided to keep an engagement in California. Mr. Murdoch's sons, James Murdoch, chief executive of Fox, and Lachlan, executive chairman of Fox, also remained apart
The Fox shareholders' meeting was held in a much smaller room with less than 60 people. The meeting lasted less than 10 minutes. But towards the end, a long-time shareholder, Philip Berman, stood up at the microphone and said, "Rupert's dream is complete."
The case ends Mr. Murdoch's reign over an entertainment empire that he has built for six decades. He will become a major minority shareholder in Disney and continue to manage his other businesses, including Fox News, the Fox broadcast network, the FS1 cable network, and newspapers like The Wall Street Journal, The New York Post, and The Sun in Britain. .
"I want to thank all our executives and colleagues for their tremendous contribution to the construction of 21st Century Fox over the last few decades," Murdoch said in a statement after the vote.
Lachlan, his eldest son, become CEO of the remaining television activities of the Murdoch family, which are collectively called New Fox. James will not join Disney and leave his father's company. His plans remain unclear, though he must earn more than $ 1 billion in the Disney deal
Disney must wait for regulatory approval before speeding up his plans. integration for 21st Century Fox – plans that include substantial layoffs. The agreement has received surprisingly fast approval from US regulators, but foreign governments still have to approve.
Analysts expect Disney to break through these obstacles in early 2019.
US antitrust regulators approved the merger, provided Disney, who already owns ESPN, sells all 22 regional Fox sports networks , which include channels like the YES network of the Yankees. Guggenheim Securities has estimated the value of the channel at around $ 22 billion.
But finding a buyer willing to pay the big price can be difficult. Regional sport networks are valuable because viewers watch live games, which is good news for advertisers. On the downside, the channels already have very high commissions from the cable companies, which limits future growth.
"While on paper the badets should be attractive, a lack of bidders could lead to a relatively lower valuation." to Cowen and Company, written in a July 19 report.
Disney has had some recent setbacks with his existing business. Walt Disney Studios unveiled two big-budget vulnerabilities – "A Wrinkle in Time" and "Solo: A Star Wars Story" – and forced longtime animator John Lbadeter to complain about an inappropriate place of work. behavior. ABC in May suffered from the collapse of "Roseanne", its greatest success; Shonda Rhimes, the biggest ABC hitmaker, has decamped for Netflix.
Disney is expected to replace Ben Sherwood, who runs the Disney-ABC Television Group. Fox has a strong list of candidates, including Peter Rice, president of 21st Century Fox. Mr. Rice is widely seen in Hollywood as a possible successor to Mr. Iger. Dana Walden, Co-Chief Executive Officer of Fox Television Group, can also join the Magic Kingdom. (Mr. Sherwood may receive another roost inside Disney.)
Iger said in a statement that he hoped to "welcome 21st Century Fox's outstanding talent for Disney and eventually integrate our activities to provide consumers around the world with attractive content and entertainment options. "
The 21st Century Fox 's acquisition is Disney' s largest, surpbading its purchase of Capital Cities / ABC in 1995 for $ 19 billion, or about $ 31 billion of money today. hui. This deal, which brought ESPN into Disney, has fueled Disney for two decades. But the cable industry is in decline, and Iger is relying on Disney's repositioning as a streaming giant that can compete with titans like Apple and Amazon. Mr. Iger believes that Fox's badets will overburden this plan
There is no guarantee, however, that he will take on the herculean task of integrating Fox, who has a culture radically different company.
After having delayed retirement several times, Mr. Iger must leave at the end of 2021.
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