Fox is desperately trying to avoid selling to Comcast

21st Century Fox has always tried to avoid selling to Comcast because Fox officials believe that a merger with the largest US cable company might not be approved by the federal government.

Comcast and the Walt Disney Company have been in a bidding war for assets sold by Fox. The most recent development came last week when Fox's management rejected a $ 65 billion Comcast bid and accepted Disney's new $ 71.3 billion offering.

Comcast could try to outbid Disney and seek Fox's shareholder approval. But Fox and Disney have said in a new filing of the Securities and Exchange Commission that a Comcast / Fox deal would face a difficult path to regulatory approval.

Fox's board prefers to merge with Disney in part because "a strategic transaction with Comcast would be subject to greater regulatory uncertainty, including the possibility of a outright ban and a higher risk of divestitures and delays." at closing, compared to a strategic deal with Disney, "said the filing.

Comcast / NBC merger conditions expire

Comcast's "asset mix" would make a Comcast / Fox deal difficult, the filing said. This probably refers to Comcast's status as the leading provider of home Internet access and the largest cable TV provider in the United States. A Comcast / Fox deal would allow Comcast to decide how much to charge other cable, satellite and online TV providers for access to this programming.

Comcast has already expanded to programming, particularly with its 2011 purchase of NBCUniversal and its ownership of regional sports networks. The US government has imposed conditions on the Comcast / NBC merger to prevent anticompetitive behavior, but these terms expire entirely in September of this year.

The purchase of Fox's properties would also give Comcast the majority control of Hulu, one of the leading online video services that competes with the cable TV industry.

Disney should also be subject to regulatory review due to its ownership of large programming assets such as ESPN and ABC. But the Fox and Disney boards of directors recommend that corporate shareholders approve the Fox / Disney merger.

Comcast repelled by Fox last year

Comcast first contacted Fox to purchase Fox properties in November 2017, the month before Fox made his first deal with Disney. Fox's management quickly concluded that an agreement with Comcast was more risky than the one with Disney.

Comcast's hopes of entering into an agreement with Fox have been raised by AT & T winning a court decision allowing it to complete its purchase of Time Warner Inc. But Comcast's continued attempts to purchase Fox's properties have not been made. not eliminated Fox's worries. Comcast's latest offer "has not addressed the risks involved with a possible transaction with Comcast, despite the fact that a transaction with Comcast, given its asset mix, raises a whole regulatory problems much more difficult than a deal with Disney ". .

As we have already written, the sale to Disney or Comcast would include 21st Century Fox film and television studios, cable entertainment networks, Fox Sports Regional Networks and international properties, including Star in India. and 39% in Europe .

The Fox sale would not include major assets such as Fox Channel News, Fox Business Network and Fox Broadcasting Company. These would be turned into a new company, and Comcast or Disney would buy 21st Century Fox after the fallout.