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Money News

Merger Mania! Why Disney and Comcast Are Fighting Over Fox

June 14, 2018

Why 21st Century Fox has never been a hotter commodity.

2 min read

It looks like we’re about to have ourselves a good, old-fashioned bidding war.

Media conglomerate Comcast has put forward an all-cash bid, worth a reported $65 billion, to acquire 21st Century Fox, in an attempt to out-muscle rival Disney.

What you need to know:

A federal court decision, allowing the merger between Time Warner and AT&T to proceed, gave other potential acquisitions the green light, spurring Comcast to action.

Bidding war—When two or more buyers are trying to acquire a company or its subsidiaries, resulting in increasingly higher offers, in an attempt to become the owner.

The $85 billion Time Warner-AT&T deal had been blocked by the Justice Department, which cited concerns about media consolidation and antitrust violations. President Trump, too, had publicly opposed the merger–an unusual move for a president–elevating the case’s profile.

Bidding wars and building arsenals

Comcast feels emboldened following the AT&T-Time Warner verdict, prompting the company to increase its bid for Fox’s assets. And with a larger, fresher offer from Comcast, Fox is sitting pretty, awaiting a counter from Disney.

Both companies want to add to their arsenals as they prepare for future battles with tech companies such as Amazon, Facebook, and Google, and content-streaming companies such as Netflix.

What the heck is happening in the media industry?

Key terms:

Acquisition—One company buying, obtaining, or taking control of another company or its subsidiaries.

Bidding war—When two or more buyers are trying to acquire a company or its subsidiaries, resulting in increasingly higher offers, in an attempt to become the owner.

Hostile takeover—When one company attempts to buy another company or its subsidiaries, against the wishes of the executives and board managing that company.

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By Sam Becker

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