Disney is better without buying sky 25/09/2018

Walt Disney does not win the winning bid to buy 61% of Sky, the UK-based European satellite TV channel. And according to analysts, this is good news for the company.

In
Analyzing the $ 40 billion bid won by Comcast Corp, Craig Moffett and Michael Nathanson of MoffettNathanson Research, write:

"We are concerned that Sky is a
albatross. Comcast would like investors to view Sky as an independent collection of proprietary programming platform platforms that can serve as a springboard for creating a global OTT provider …
But it seems they would like investors to forget that it is also a satellite TV provider and that satellite video distribution is becoming more and more obsolete. "

In addition, this will help reduce Disney's recent $ 71.4 billion deal for half of 21st Century Fox – especially if Comcast is looking to buy the remaining 39% that Fox owns – now a part of
Disney

Barton Crockett, Media Analyst at B.Riley FBR, writes, "This significantly reduces net cash outflows for the Fox transaction."

he
adds: "[Disney’s] The stake in Sky now seems to be worth around $ 15 billion. If Disney is able to make tax-efficient bids for this participation in Comcast and tax effectively cede Fox regional sports.
the networks for the valuation – we assume that $ 20 billion – the total sum of $ 35 billion in cash would essentially correspond to the $ 35 billion that Disney agreed to pay for Fox.

Although some are praising the Comcast deal, Comcast will now have 23 million satellite subscribers and 2 million OTT in Europe. He becomes a leading provider of sports television in Europe,
as well as obtaining global content rights licensed to Sky for the coming years.

Todd Juenger, Media Analyst for Bernstein Research, says: "In our opinion, no
these are vital to Disney's DTC [direct to consumer] entertainment strategy or without substitutes that Disney could benefit in a much less destructive way of value than paying $ 39 billion for
Sky."

Monday mid-day trading of Disney shares rose 2% to $ 112.77; Comcast was down 8% to $ 34.89.

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