Exclusive: Comcast prepares all-cash bid to gate-crash Disney-Fox deal - sources

Exclusive: Comcast prepares all-cash bid to gate-crash Disney-Fox deal – sources

(Reuters) – U.S. cable operator Comcast Corp is talking to funding banks about acquiring bridge financing for an all-cash bid to displace Walt Disney Co on its $52 billion deal to purchase most of Twenty-First Century Fox Inc’s property, three individuals conversant in the matter stated on Monday.

The transfer is the primary concrete step that Comcast is taking to upend Disney’s deal with Fox. It units Comcast Chief Executive Brian Roberts on a collision course with two different media trade titans, Fox Executive Chairman Rupert Murdoch and Disney CEO Bob Iger.

Comcast, proprietor of NBC and Universal Pictures, has already made a 22 billion pound ($30 billion) supply to purchase the 61 p.c stake in European pay-TV group Sky Plc that Fox doesn’t already personal. In doing so, it topped an earlier supply for the whole thing of Sky by Fox.

Comcast is asking funding banks to enhance the bridge financing facility they’ve already organized for the Sky supply by as a lot as $60 billion to finance the Fox bid, the sources stated.

Comcast is ready for a decide to rule subsequent month on the U.S. Department of Justice’s problem to telecommunications supplier AT&T Inc’s deliberate $85 billion acquisition of media conglomerate Time Warner Inc earlier than it submits a suggestion to Fox, the sources stated.

Fox rejected a suggestion from Comcast final yr largely due to antitrust considerations, and Comcast plans to make a brand new supply provided that AT&T and Time Warner prevail in courtroom, the sources added.

The sources requested not to be recognized as a result of the matter is confidential. Comcast, Fox and Disney didn’t instantly reply to requests for remark.

Fox shares rose 5.13 p.c to $39.99 on the information in after-hours buying and selling in New York on Monday. Comcast shares had been down 1.5 p.c to $31.90, whereas Disney shares had been down zero.5 p.c to $102.00.

FILE PHOTO: The NBC and Comcast logos are displayed on 30 Rockefeller Plaza in midtown Manhattan in New York, U.S., February 27, 2018. REUTERS/Lucas Jackson/File Photo

Disney clinched an all-inventory deal in December to purchase Fox’s movie, tv and worldwide companies, giving the world’s largest leisure firm an arsenal of exhibits and flicks to fight rising digital rivals Netflix Inc and Amazon.com Inc.

Murdoch, who owns shut to a 17 p.c in Fox and likewise has voting management, had a choice on the time for a inventory deal, as a result of it made the transaction non-taxable at a Fox shareholder stage. It just isn’t clear how receptive he can be to an all-cash supply by Comcast.

Disney has dedicated to share buybacks to give some money to Fox shareholders. As a end result, Comcast sees a gap in being disruptive to the deal by making an all-cash bid, in accordance to the sources.

Last November, Comcast supplied to purchase most of Fox’s property in an all-inventory deal valued at $34.41 per share, a regulatory submitting confirmed final month. Like Disney, Comcast sought to purchase Fox’s leisure networks, film studios, tv manufacturing and worldwide property, the submitting exhibits.

Fox ended up asserting an all-inventory deal with Disney for $29.54 per share. In the regulatory submitting, Disney and Fox cited regulatory hurdles as causes to reject Comcast’s bid, though they didn’t reference it by identify.

The submitting additionally exhibits that Fox noticed Disney’s inventory as extra helpful than Comcast’s, primarily based on historic costs, and felt deal between Disney and Fox would generate better lengthy-time period worth. The Roberts household controls Comcast by means of a twin-class inventory construction.

FILE PHOTO: The NBC and Comcast brand are displayed on prime of 30 Rockefeller Plaza, previously often known as the GE constructing, in midtown Manhattan in New York July 1, 2015. REUTERS/Brendan McDermid

Comcast’s inventory has dropped since then, from round $38 to about $32 now, giving the corporate a market capitalization of $149 billion.

Reporting by Greg Roumeliotis and Liana B. Baker in New York; Additional reporting by Jessica Toonkel in New York; Editing by Lisa Shumaker

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