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| Acquisition of 21st Century Fox by Disney | |
|---|---|
| Name | The Walt Disney Company–21st Century Fox acquisition |
| Type | Corporate acquisition |
| Date | Announced December 14, 2017; Closed March 20, 2019 |
| Acquirer | The Walt Disney Company |
| Target | 21st Century Fox |
| Value | US$71.3 billion (equity) |
| Consideration | Stock and cash |
| Status | Completed (major assets); certain assets divested/separate |
Acquisition of 21st Century Fox by Disney The acquisition was a transformative consolidation in the media industry culminating in a multi-billion-dollar purchase of key assets of 21st Century Fox by The Walt Disney Company announced on December 14, 2017 and completed March 20, 2019. The transaction reshaped holdings of major studios and networks including 20th Century Fox, Fox Searchlight Pictures, FX Networks, and international operations, while prompting regulatory scrutiny from authorities such as the United States Department of Justice, the European Commission, and the United Kingdom Competition and Markets Authority. Major figures and institutions involved ranged from executives at Disney and Fox to investors like Rupert Murdoch, Bob Iger, and shareholder activists including Elliott Management Corporation.
In the decades before the transaction, News Corporation split in 2013 into a publishing arm and a separate 21st Century Fox entertainment company, consolidating assets such as 20th Century Fox, Fox Broadcasting Company, and international holdings like Star India and Sky plc. The Murdoch family, led by Rupert Murdoch and executives including James Murdoch and Lachlan Murdoch, stewarded a portfolio that intersected with legacy studios like Twentieth Century Fox Film Corporation and cable networks including FX Networks. Meanwhile, The Walt Disney Company under CEO Bob Iger pursued strategic acquisitions earlier in the 21st century, notably purchasing Pixar in 2006 and Marvel Entertainment in 2009, and later Lucasfilm in 2012, building a content library that included franchises associated with Marvel Cinematic Universe and Star Wars. The rise of streaming platforms such as Netflix and the launch plans for Disney+ influenced both companies' strategic calculus, intersecting with alliances like Comcast Corporation's interests in entertainment assets and prior consolidation efforts including Time Warner negotiations.
On December 14, 2017, The Walt Disney Company announced an agreement to acquire a majority of 21st Century Fox's entertainment assets for approximately US$52.4 billion in stock and assuming debt, later revised to an equitable transaction valued at about US$71.3 billion. The deal covered 20th Century Fox, Fox Searchlight Pictures, FX Networks, and stakes in international firms like Sky plc and Hulu. The acquisition terms involved share exchanges affecting Disney shareholders, and rights for 21st Century Fox shareholders including the Murdoch family. Competing bids and interest emerged from Comcast Corporation, which later pursued an offer and engaged in a bidding war, invoking agreements and break-up fees governed by corporate law and board agreements with parties such as Rothschild & Co advisors and financial institutions including Goldman Sachs.
Regulators in multiple jurisdictions reviewed the transaction for potential competition concerns: the United States Department of Justice examined vertical and horizontal effects on film and television distribution; the Federal Communications Commission assessed broadcast-related issues; the European Commission considered impacts across the European Union; and the United Kingdom Competition and Markets Authority evaluated effects on competition including on pay-TV and production markets. Antitrust concerns touched on combined control over content libraries and distribution channels, implicating remedies monitored by agencies like the Australian Competition and Consumer Commission and authorities in Mexico, Brazil, and China. The deal required divestitures, behavioral remedies, and clearances; unresolved issues involved content licensing on platforms like Hulu and international carriage agreements with operators such as Sky plc.
Transferred assets included 20th Century Fox, Fox Searchlight Pictures, FX Networks, and international channels and studio operations, as well as a controlling stake in Hulu increasing The Walt Disney Company's influence in streaming. Excluded from the transaction were the Fox Corporation assets retained by the Murdoch family, including Fox Broadcasting Company, Fox News Channel, Fox Business Network, Fox Sports regional networks (later sold), and publishing entities formerly under News Corporation. Certain international assets, minority stakes such as holdings in Sky plc, and regulatory-driven divestitures—like sale requirements affecting regional sports networks—were negotiated with buyers including Comcast Corporation and investment groups such as Sinclair Broadcast Group and Walt Disney Company's financing partners.
The financial structure combined The Walt Disney Company stock issuance, cash consideration, and assumption of debt, with valuation metrics reflecting future cash-flow projections, content library valuation, and synergies in distribution including streaming. Investment banks and advisers, including Goldman Sachs, Morgan Stanley, and J.P. Morgan, modeled scenarios incorporating potential cost savings from consolidation of studio operations, expected revenue from franchises like Avatar sequels and X-Men integration into the Marvel Cinematic Universe, and subscription growth for Disney+. The acquisition price invoked discussions among investors such as Elliott Management Corporation and was subject to shareholder votes and fiduciary duties overseen by boards chaired by figures like Robert Iger at Disney and Rupert Murdoch at 21st Century Fox.
The transaction significantly altered market concentration among major entertainment conglomerates, affecting competitors like Comcast Corporation, AT&T Inc. (owner of WarnerMedia at the time), and global distributors including Sony Pictures Entertainment. It reshaped content ownership for franchises and intellectual property such as X-Men, Deadpool, and Avatar, while intensifying competition in streaming against Netflix, Amazon (notably Amazon Prime Video), and entrants like Apple Inc. (Apple TV+). The consolidation prompted strategic realignments at networks and studios including FX and 20th Television, influenced licensing deals with platforms like Hulu and pay-TV operators, and had cultural impacts on independent production companies and creators associated with labels like Searchlight Pictures.
Following closing, The Walt Disney Company initiated integration of studio operations, combining film production, distribution, and television networks into divisional structures overseen by executives from Disney and assimilated leadership from 21st Century Fox. Organizational changes included consolidation of back-office functions, realignment of creative leadership affecting units such as 20th Century Studios, rebranding efforts, and talent migration influencing producers and filmmakers connected to entities like Searchlight Pictures. Management decisions involved executives such as Bob Iger and later Bob Chapek, and impacted labor relations with unions including SAG-AFTRA and Writers Guild of America.
Legal disputes arose regarding breach notices, shareholder litigation, and antitrust compliance, with suits brought by investors challenging fiduciary duties and deal disclosure. The Department of Justice required certain divestitures, and subsequent litigation touched on valuation adjustments and earn-outs tied to assets. Post-acquisition, Fox Corporation continued independently under Rupert Murdoch and Lachlan Murdoch, while Disney proceeded to integrate franchises into the Marvel Cinematic Universe and expand Disney+ content offerings. The long-term consequences included further consolidation activity in media, regulatory scrutiny of vertical integration, and strategic shifts by competitors such as Comcast Corporation and AT&T Inc. responding to altered content ownership and distribution dynamics.
Category:Media mergers and acquisitions