Disney has received the (likely) winning card in the company’s pursuit of 21st Century Fox. The Justice Department has approved Disney’s purchase of 21st Century Fox with only one condition. Disney must sell off Fox’s regional cable sports networks, which Disney has agreed to do.
From a regulatory perspective, all that is left is for a federal judge to sign off on the deal. Since the Justice Department has already filed their approval, however, that step is a mere formality.
Disney currently has the highest bid ($71.3B) for most of 21st Century Fox’s assets, besting Comcast’s $65B bid from a couple weeks ago. Fox prefers Disney’s bid, not just for the amount, but also because of Fox’s belief that a Comcast deal would face much more regulatory scrutiny than one with Disney.
That belief is now inarguably correct. There are no regulatory concerns over a deal with Disney now. It’s already been approved by the government, so any deal with any other company, including Comcast, inherently carries more regulatory risk.
That is something that will be on the minds of Fox shareholders, who must ultimately vote in favor of the Disney offer. Even if Comcast comes back with a higher offer, it will be hard to convince those shareholders to gamble on a regulatory approval that may or may not come (and take many months, or even a couple years to close) when Disney’s offer is now a sure thing.
Disney and Fox shareholders were scheduled to vote on the previous $52.4B deal on July 10, but it was postponed due to Disney’s increased bid last week. A new date has yet to be announced, but we should hear about one soon now that the Justice Department has filed their approval.