Sorry, Comcast: Fox and Disney sign new merger deal, rejecting Comcast bid

Disney making $70.3 billion counterbid for Twenty First Century Fox

The new offer comes just a week after Comcast's $65 billion bid. The amended and restated Disney Merger Agreement offers a package of consideration, flexibility and deal certainty enhancements that is superior to the proposal made by the Comcast Corporation on June 13, 2018.

"The acquisition of 21st Century Fox will bring significant financial value to the shareholders of both companies, and after six months of integration planning we're even more enthusiastic and confident in the strategic fit of the assets and the talent at Fox", said Robert A. Iger, Chairman and Chief Executive Officer, The Walt Disney Company.

As expected, now Disney has upped their offer for the purchase of Fox Studios, which follows Comcast having offered a $65 billion all-cash deal. AT&T just bought Time Warner for $81 billion, after a federal judge rejected the government's antitrust concerns.

Fox, which has been trying to take full control of Sky since December 2016, originally offered 1075p per Sky share but this has since been trumped by a 1250p-a-share offer from Comcast that values the whole of Sky at £22.1bn.

"Comcast's balance sheet may preclude it from bidding much higher", Sweeney said.

So Fox and Disney can expect Comcast to come running back with a new offer. Comcast, based in Philadelphia, did not immediately respond to a request for comment. Disney's new offer of $38 per share, or $71.3 billion, is half cash and half stock.

"We remain convinced that the combination of 21st Century Fox's iconic assets, brands and franchises with Disney's will create one of the greatest, most innovative companies in the world". 21st Century Fox shareholders will receive an exchange ratio of 0.3324 shares of Disney common stock if the average Disney stock price at closing is above $114.32 and 0.4063 shares of Disney common stock if the average Disney stock price at closing is below $93.53. But Comcast has also bid to buy all of Sky at £12.50 ($16.46) a share (higher than Fox's proposal of £10.75 a share).

Quoting Bloomberg News, CNBC reported that Disney was nearing U.S. Justice Department approval on the deal. Disney said it's raising its offer because Fox's value increased due to "tax reform and operating improvements".

Fox shares rose 5.4 percent, to $47.11, in premarket trading, while Comcast was marginally lower. Fox and Disney shareholders had been scheduled to vote on Disney's original bid July 10, but that meeting has been postponed.

That court decision paved the way for Comcast's attempt to swipe Fox from Disney.

21st Century Fox is one of the world's leading portfolios of cable, broadcast, film, pay TV and satellite assets spanning six continents across the globe.

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