News/Analysis
DisneyBizJournal.com
July
19, 2018
As
expected, Comcast announced today that it would be stepping aside in its race
with Disney to acquire assets from 21st Century Fox.
In
a company statement, Brian Roberts, Comcast’s chairman and CEO, said, “I’d like
to congratulate Bob Iger and the team at Disney and commend the Murdoch family
and Fox for creating such a desirable and respected company.”
As
MarketWatch noted, “Comcast
shares have fallen 15% so far this year, while Fox shares have risen 35%.
Disney shares have risen 3%, and the S&P 500 SPX, -0.41% has gained 5.3%.” Disney and Fox shareholders
are expected to approve the deal on July 27th.
In
DisneyBizJournal.com’s
analysis of the Disney-Fox deal earlier this week, I
highlighted a host of properties being acquired by Disney that present
significant growth opportunities for Disney, its shareholders and fans, while
also noting some risks, such as regarding the Avatar franchise. That piece
concluded: “When sinking $71.3 billion into a venture, it seems obvious to ask:
How long will it take Disney to see a return on this investment? Indeed, the
ramped up price Disney is paying leaves little room for error in how these
assets are utilized. The entertainment business is notoriously fickle, and of
course, it will be years before we know if this purchase was a success. In the
end, though, given the full set of assets being acquired, it would seem unwise
to bet against Disney.”
Ray
Keating is the editor, publisher and economist for DisneyBizJournal.com, and
author of the Pastor Stephen Grant novels, with the two latest books being Reagan
Country: A Pastor Stephen Grant Novel and Heroes and
Villains: A Pastor Stephen Grant Short Story. He can be
contacted at raykeating@keatingreports.com.
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