- 21st Century Fox may be open to selling off many of its media assets amid troubles in its Sky Broadcasting acquisition and increased competition.
- Disney was the first interested buyer, with Comcast and Verizon coming in about a week later.
- 21st Century Fox's stock has risen each time a new interested buyer was reported, leading to speculation a bidding war could break out.
At a Goldman Sachs hosted conference in September, 21st Century Fox Executive Chairman Lachlan Murdoch said his company was fighting a two-front battle. One in the US against consolidating competitors like AT&T and Sinclair Broadcast Group, and the other in Europe for control of Sky Broadcasting.
The company’s fight for Sky Broadcasting has been delayed as anti-competition panels look into the deal. While Fox awaits the final decision on Sky, it isn’t willing to spend a lot of capital in the US to fend off its rivals, Murdoch said at the Goldman Conference. But, “if we could [keep our rivals at bay] in other manners it’s something we’d be open to looking at,” Murdoch added, according to a report from Variety.
Since Murdoch made that comment, another manner surely has opened up in the form of a bidding war for parts of the company. Disney, Comcast and Verizon have all shown their interests in purchasing parts of 21st Century Fox, and it looks as if Fox is willing to come to the table.
Disney is primarily interested in 21st Century Fox's film and entertainment assets, leaving behind the sports and news parts of its business to hopefully avoid anti-competition scrutiny. Disney owns its own broadcast company in ABC, and wouldn't be allowed to own two networks.
Disney is also reportedly interested in purchasing Fox's 39% stake in Sky Broadcasting, which would free Fox from its ongoing ownership battle.
Reports of Disney's talks with 21st Century Fox broke on November 6, and some speculated that the assets Disney was interested in could help boost the amount of content Disney would be able to offer in its recently announced streaming service.
Shares of 21st Century Fox spiked about 6% following the report that Disney was interested in parts of the company.
Comcast is interested in similar assets to Disney, focusing on the entertainment content and staying away from its news and sports assets.
Comcast’s rival, AT&T, has agreed to purchase Time Warner, which owns HBO and other entertainment channels, but the deal has run into a roadblock. The US Department of Justice wants the company to jettison parts of Time Warner to gain approval for the acquisition. Comcast’s interest in Fox may stem from its desire to acquire more content to keep pace with AT&T.
Buying Fox's entertainment assets would give Comcast more content to match its rival's acquisition of Time Warner, which owns HBO and other content channels.
Verizon became interested in 21st Century Fox shortly after Comcast did, according to the Wall Street Journal. The wireless company could have also been spurred on by the willingness of Fox to sell and AT&T's planned purchase of Time Warner.
Shares of 21st Century Fox are up 16.21% in the last month and the stock has risen each time a new interested buyer was reported. Shares are up 5.59% to $30.96 on Friday, leading to a market cap of $56.463 billion. Multiple interested buyers could lead to a bidding war for the company, while talks with each still seem to be in preliminary stages.
21st Century Fox is up 7.43% this year after all the reports of buyers.