There is nothing easy about $52.4 billion corporate mergers. Disney and Fox may have agreed on the former purchasing the majority of the latter’s assets late last year, but nothing is final until all regulatory hurdles are cleared. Until then, the bidding is still technically open and CNBC reports that their own parent company, Comcast, could reenter the equation.
Comcast exited their own negotiations with Fox days before the latter accepted Disney’s bid. According to CNBC, the reason Comcast struggled to compete was Fox boss Rupert Murdoch’s belief that a deal with Comcast would have a harder time getting through government regulation than a deal with Disney.
Murdoch is right. The AT&T-Time Warner merger is facing strong opposition from the government and that deal is much more comparable to a Comcast-Fox pairing than Disney-Fox. If that AT&T-Time Warner deal goes through, however, that could signal a clear path for a merger between Comcast and Fox.
CNBC’s sources have heard that Comcast leadership is undecided, but at least considering an unsolicited bid for Fox’s assets since the company can probably offer a premium on top of Disney’s $52.4 billion purchase price. Murdoch could be prompted to change his mind, or even if he wants to stick with Disney, he could be outvoted by Fox shareholders who think Comcast is offering a better deal.
Disney is reportedly aware of this possibility and considering potential countermeasures should this occur. That does not mean Disney, or anyone else, believes this is going to happen, but with so much at stake, they have to be prepared for any possibility, this included.
The obvious issue this raises for Marvel fans is the status of the X-Men (under which Deadpool falls) and Fantastic Four movie licenses currently owned by Fox. Disney is set to get those licenses back in their purchase of Fox, but what if Comcast successfully outbids the Mouse?
Should that happen, it will all come down to the language in each licensing contract (and my understanding is that X-Men and Fantastic Four are separate contracts). Any contract that includes language that prevents the license from being transferred to another party, even in the event that the licensee (Fox) is acquired by another company, would allow the license to revert back to Disney/Marvel even if Comcast buys Fox instead of Disney.
If no such language exists in those licensing agreements, then Comcast could become the new owner of the X-Men and Fantastic Four movie rights. If I’m correct in thinking the X-Men and Fantastic Four licenses are completely separate deals, one could have language preventing a transfer while the other doesn’t. That means Comcast could get X-Men and not Fantastic Four, or vice versa.
The latter scenario seems the least likely, but this situation is already weird enough to prevent me from ruling anything out unless someone who’s actually seen those licensing contracts speaks on the record.
We knew the Disney-Fox deal would encounter some obstacles along the way and this may just be the first.