Disney Sweetens Offer for Fox to $71 Billion, Outbidding Comcast

Walt Disney raised its offer for 21st Century Fox’s entertainment assets to $71.3 billion, outbidding Comcast, according to Bloomberg.

The $38-a-share price is about $10 a share higher than what Disney proposed in December and $3 above Comcast’s bid from last week. Fox has accepted the offer, saying it provides more flexibility and other enhancements than the $65 billion Comcast deal. Still, the opportunity remains for the cable giant to return with sweetened terms.

At stake is a trove of media properties, ranging from “The Simpsons“ to “X-Men,“ that may help fend off the threat from Netflix and other streaming upstarts. Both Disney and Comcast are looking to use the Fox assets to bolster their content and expand overseas.

The tussle follows AT&T’s victory over the U.S. Justice Department in its antitrust battle to take over Time Warner. That outcome is expected to spur a wave of media consolidation, emboldening companies to get more aggressive with deals.

The Disney-Comcast contest will determine who controls much of Rupert Murdoch’s empire, including Fox’s movie and TV studios, television networks such as FX, and multichannel providers like Star India and Sky. Part of the business will be used to create an entity called “New Fox,“ which will include Fox News, the sports channels FS1 and FS2, and the Fox broadcasting channel.

Disney’s new offer gives Fox shareholders the option to take their payment in the form of cash or stock, up to a 50-50 level. The previous agreement was an all-stock deal, and Comcast’s cash offer was seen as a significant enticement. Disney also plans to take on about $13.8 billion of Fox’s net debt. That would lift the total transaction value above about $85 billion.