AT&T, Time Warner Merger Approved by Judge

Ruben Ruiz
June 14, 2018

Comcast announced in May that it was preparing an offer to buy 21st Century Fox after an earlier bid was rejected, and news reports suggest that an offer could come as soon as Wednesday. The offer is expected to spark a bidding war between the two powerhouses, Disney and Comcast.

Both Disney and Comcast could use Fox's TV and movie properties to stream more content directly to consumers and compete with Netflix Inc.

The Disney deal includes 20th Century Fox, Fox Searchlight Pictures, Fox 2000, 20th Century Fox Television, FX Productions, Fox21, FX Networks, National Geographic Partners, Fox Sports Regional Networks, Fox Networks Group International, Star India and Fox's interests in Hulu, Sky, and Endemol Shine Group. Once the transition is completed, the remaining Fox assets will be formed into a new company, jokingly called "Diet Fox" by Rice, and management changes will be announced over the next year. Numerous company's assets were long thought to be acquired by Disney, but as promised, Comcast has now officially swooped in with a superior offer to acquire Fox's film studio, most of its TV channels, and more.

AT&T argued that its proposed acquisition of Time Warner is a defensive move against the increasing threat of internet TV services like Netflix, Amazon, and YouTube. While the Department of Justice could still appeal, Comcast seems to believe the gateway is open and made a decision to go in with a heavy hand in regards to 21st Century Fox. Disney has deep pockets, so if they wanted to they can increase the offer to meet Comcast's, but there is the matter of all-cash versus stock, something that 21st Century Fox will have to weigh.

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This could set off a battle between Comcast and Disney . The Comcast bid represents a 19% "premium" over the Disney bid, and is all-cash compared to Disney's all-stock offer, although Disney's all-stock offer will not be subject to capital gains tax for Fox shareholders, making the value of the stock deal somewhat better than it appears on paper.

Guess we'll just have to wait and see.

The Philadelphia-based company is preparing an offer for 21st Century Fox. Comcast shares fell 3.3 percent, though.

Unfortunately for the MCU fandom, the $52.4 billion deal offered by the Mouse House to purchase a majority of assets owned by Fox - including Deadpool, the Fantastic Four and the X-Men - "is in more jeopardy than some may believe". T-Mobile's merger with Sprint is next on the block, and regulators will soon have to decide whether or not they'll challenge that deal. The government anxious that AT&T, as DirecTV's owner, could charge Comcast and other rival distributors higher prices for Time Warner channels like CNN or HBO. Now that you know the merger can go ahead, what kind of effect is it likely to have on media companies, telecom companies, other potential deals in the space? The ruling blesses the $85 billion merger, one of the biggest media deals ever.

Other reports by GizPress

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