Disney’s $71.3 billion acquisition of 21st Century Fox has been a long road that’s close to its finish, so we’ve pieced together a timeline of the deal from its start to its imminent now-imminent conclusion. The deal is historic in its scale and marks the latest in a series of major acquisitions by the House of Mouse, like the 2012 purchase of Lucasfilm for $4.05 billion.
The merging of Disney and Fox will reduce the ‘Big Six’ Hollywood studios down to just the Big Five, and could allow Disney to control as much as 40% of the box office. It will also inevitably result in thousands of job losses from positions at both Disney and Fox that will become redundant after the merger. So, while comic book fans may be excited by the prospect of finally seeing the X-Men and Fantastic Four join the Marvel Cinematic Universe, there are plenty of reasons to be concerned about what the Disney-Fox deal means for the future of Hollywood.
As with AT&T’s acquisition of Time Warner, Disney’s purchase of the majority of 21st Century Fox’s assets has had to jump through a number of regulatory hoops, both domestic and foreign. By the time it wraps up, around 18 months will have passed between Disney’s initial offer to buy Fox and the acquisition’s officially going through, and a transition period is still to come. Here’s a timeline of the process so far.
- This Page: Disney’s Original Offer and Comcast’s Competing Bid Page 2: Disney Wins The Bidding War & What Happened Next
Disney’s Original Offer For 21st Century Fox
Reports of Disney’s plan to buy Fox first began circulating in early November 2017, and shortly afterwards there were reports that Comcast, Sony, and Verizon had also joined in a bidding war for Fox’s film and TV assets. Of those three, Comcast would prove to be Disney’s fiercest competitor. The telecommunications company initially ducked out of the race, explaining in a statement that it had a “responsibility” to its shareholders to evaluate the potential benefits of acquiring a major set of assets like those put up for sale by Fox, but claiming that “we never got the level of engagement needed to make a definitive offer.” However, this was not the last time that Comcast would make a bid for 21st Century Fox.
On December 14, 2017, Disney and Fox announced a “definitive agreement” for the former to acquire the latter, including the 20th Century Fox film division and TV businesses, but not including the Fox Broadcasting network or stations like Fox News Channel. At the time, the price tag on the acquisition was estimated to be around $52.4 billion in stock. At this time AT&T’s similarly huge acquisition of Time Warner was being blocked by a Department of Justice lawsuit, so the Disney-Fox deal still had an uncertain road ahead - one that got more complicated when Comcast made a comeback.
Disney’s Bidding War With Comcast For Fox
Despite seemingly bowing out of the bidding war initially, by May 2018 Comcast was meeting with investment banks, seeking to top Disney’s initial $52.4 billion offer. Of particular interest to Comcast was Sky plc., a European telecommunications company based in London, of which Fox already owned a controlling 39% stake and was making moves to acquire the rest. As Disney and Comcast tussled over acquisition of Fox, it was suggested that Fox’s assets could be split, with Comcast claiming its coveted prize of Sky while Disney took the rest of Fox’s available assets.
On June 12, 2018, AT&T’s acquisition of Time Warner was finally approved by the Department of Justice, setting a precedent for an acquisition of the same scale. Sure enough, the very next day Comcast put in an all-cash counter-offer of $65 billion for 21st Century Fox. A week later, on June 20, 2018, Disney came back with a $71.3 billion offer - and Fox agreed to it. On July 19, 2018, Comcast said that it no longer had plans to continue pursuing acquisition of Fox’s assets - though the company did continue its pursuit of Sky and, following a bidding war with Fox, Comcast eventually succeeded in purchasing all available shares of Sky by November 2018.
Page 2: Disney Wins The Bidding War & What Happened Next
Fox Accepts Disney’s $71 Billion Bid
Disney and Fox’s shareholders officially voted to approve the $71.3 billion deal on July 27, 2018. The details of the merger had been laid out in a letter to shareholders the previous month, detailing exactly how 21st Century Fox’s assets would be split, and what Disney would be acquiring.
The Fox Broadcasting Company, Fox News Channel, Fox Business Network, the Big Ten Network, FS1, FS2 and Spanish-language sports channel Fox Deportes were not included in the acquisition. Instead, it was agreed that a new subsidiary called New Fox (later renamed Fox Corporation) would be formed and enter into a separation agreement with 21st Century Fox, creating two distinct companies - one of which would remain independent, while the other became a Disney subsidiary. That will leave Disney with the entirety of the 20th Century Fox film division, including major franchises like X-Men, Deadpool, Avatar, Die Hard, and Kingsman, as well as 20th Century Fox Television shows like The Simpsons, This Is Us, The X-Files and The Gifted.
While Disney isn’t getting Fox’s news networks in the merger, the company will nonetheless acquire FX Productions and the FX Networks, including FX, FXX and FXM, and with them shows like It’s Always Sunny In Philadelphia and Legion. The deal will also give Disney a 60% share of streaming platform Hulu.
However, as one of the conditions given by the Department of Justice in its approval of the deal, Disney must sell off Fox’s regional sports networks to third parties, and in November 2018 the European Commission ruled that Disney must also sell off A&E Networks Europe, including channels like Blaze and Lifetime. Disney owns a 50% stake in those networks, and is expected to sell its shares to Hearst Communications, which owns the other 50%.
Disney Is Undergoing Regulatory Approval
The Department of Justice approved the Disney-Fox merger on June 27, 2018 - but that was merely the first step in seeking the necessary regulatory approval. Since a merger of this size raises potential antitrust concerns, and Disney obviously has business all over the world, the company needs to gain approval from each country’s regulatory body before the deal can be finalized. One of the biggest challenges was gaining the approval of the European Commission, which oversees regulation for all countries in the European Union. On October 15, 2018, Disney submitted a list of antitrust concessions to the European Commission, which finally granted its approval on November 6, 2018 - one of the major conditions being the aforementioned sale of Disney’s A&E Networks Europe shares.
On November 19, 2018, China - the final major regulatory hurdle - granted its approval for the merger with no conditions. In a Q1 earnings conference call on February 5, 2019, Disney Chairman CEO Bob Iger said that Disney and Fox would begin the process of “effectively combining our businesses” as soon as approval was granted by the “last few remaining markets.” According to Disney’s most recent Securities and Exchange Commission filing, the merger is expected to reach completion before June 2019.
