Two former senior executives at Rupert Murdoch’s 21st Century Fox have been indicted over their alleged role in a multimillion-dollar bribery scheme involving kickbacks to FIFA officials in exchange for broadcast and marketing rights to some of the world’s biggest football tournaments.
A whopping $128 million ruling in arbitration came after Fox licensed the Emily Deschanel series to Hulu for very little. Next week, the parties appear in open court for the next round of the dispute.
Sinclair Broadcast Group appears to have emerged as the leading candidate to win the auction of 21st Century Fox’s regional sports networks, having placed what people close to the deal call the top bid to acquire the properties.
The ripple effects may not become clear for years. Analysts say that Disney could force smaller studios to merge as they scramble to compete. It will have greater leverage over theater owners when it comes to box office splits. And Disney’s plans to use Fox content to forcefully move into streaming could slow the growth of Netflix. “This deal definitely reshapes the landscape,” said Michael Nathanson, a leading media analyst.
The demise of 20th Century Fox as a standalone studio is an epochal event in Hollywood, one that casts long shadows over a movie industry grappling with new digital competitors from Silicon Valley and facing the possibility of further contraction.
It’s finally complete. Disney closed its $71 billion acquisition of Fox’s entertainment assets on Wednesday, more than a year after the mega merger was proposed . Disney gets far ranging properties ranging from Fox’s film studios, including “Avatar” and X-Men, to its TV productions such as “The Simpsons” and networks including National Geographic.
Exclusives
The deal for Fox’s entertainment businesses is likely to shake up the media landscape. Among other things, it paves the way for Disney to launch its streaming service, Disney Plus, due out later this year. It will also likely lead to layoffs in the thousands, thanks to duplication in Fox and Disney film-production staff.
A new era for the Murdoch clan and the media business begins with the debut of Fox Corp. on Tuesday, a day before Disney completes its acquisition of 21st Century Fox. The new-model Fox will begin trading Tuesday on the NASDAQ under the FOXA symbol. On Tuesday, 21st Century Fox will initiate a complex transfer of the Fox Corp. assets — primarily Fox News, Fox Sports, and Fox Broadcasting — to the newly created Fox Corp.
Thirty-four years ago, Rupert Murdoch showed up in Hollywood with $250 million, buying a stake in the 20th Century Fox film studio – even though he had little interest in making movies. The scrappy Australian newsman, then known for his clamorous tabloids, was viewed with suspicion. Skeptics assumed he was a corporate raider intent on stripping value from the studio. Instead, Murdoch rescued a threadbare operation from financial ruin and turned it into the centerpiece of a growing empire that has reshaped the entertainment industry. Now, Murdoch is dismantling his life’s work: a kingdom worth more than $100 billion.
Disney has set a March 20 closing date for the acquisition of 21st Century Fox. The date was included in a release in which Disney indicated that the company has received the last major approval for the deal from regulators in Mexico. According to Disney, 21st Century Fox shareholders will have until Thursday to choose the amount of cash and Disney stock to receive in the $71.3 billion transaction.
Walt Disney Co.’s entertainment kingdom is about to get a whole lot bigger thanks to its pending purchase of 21st Century Fox assets, and the rest of Hollywood has only just begun to grapple with the consequences of the company’s increasing power.
Walt Disney Co. CEO Bob Iger told the studio’s annual shareholders meeting that the combined company will “hit the ground running” when the industry-rattling merger is completed.
There’s a lot of fear in the offices that comprise Rupert Murdoch’s and Bob Iger’s media empires. There have been mergers in Hollywood before. But the marriage of Fox and Disney is uncharted territory in the media landscape. There’s rarely been an acquisition of this size or a union of two such storied brands with distinct cultures. Disney, with its buttoned-down air, is far removed from the more Darwinian approach to management long favored by Fox.
The company is cutting an annual base salary increase of $500,000 that Iger was set to receive when the Fox deal closes and maintains his current base of $3 million. It cuts the annual bonus he was set to receive by $8 million to $12 million. It also cut his annual target long-term incentive award by $5 million to $20 million.
An upcoming legal faceoff over executive hiring could completely upend the traditional studio practice of locking in employees through long-term contracts. Is the entertainment world ready to embrace the gig economy?
Disney took a big step closer to completing its $71.3 billion purchase of 21st Century Foxwith Brazil’s conditional approval of the deal Wednesday. In an agreement with Brazil’s antitrust agency, Disney will sell the Fox Sports cable channel that serves the largest media market in South America. Brazilian regulators focused on Disney’s ownership of ESPN and Fox Sports as giving it too much power over sports rights and related deals.
Walt Disney Co.’s $71 billion takeover of 21st Century Fox assets was expected to turn the Murdoch family into one of the biggest voices at the entertainment giant. But the six Murdoch children — heirs to billionaire Fox founder Rupert Murdoch — will be paid cash and stock from the deal individually, according to people familiar with the situation. That means they may not be much of a force at Disney, even though the family as a whole will become one of the biggest investors.
In a long-running legal battle over profits from the David Boreanaz-Emily Deschanel hit, an arbitrator’s stunning decision calls out top executives Peter Rice, Dana Walden and Gary Newman and could alter the economics of hit shows in the streaming era.
Walt Disney Co., on the brink of sealing its $71 billion takeover of 21st Century Fox Inc. entertainment assets, will agree to sell the Fox Sports channels in Brazil and Mexico to win regulatory approval there, according to people close to the discussions
For years, everyone in the industry loved to debate which of Murdoch’s three adult children from his second marriage — James, Lachlan, or Elisabeth — would ultimately assume the throne of their father’s vast empire. While the huge Disney sale has put to bed that question for a simple reason — instead of a globe-girdling empire, the Murdoch heirs are about to inherit a war chest — it also raises a new one: What will they do with all that money?
The sale of the nearly two dozen of the Fox regional sports networksOpens a New Window. hampered by lowball bids, confusion over the ownership of digital rights and overly optimistic expectations by bankers on the final sales price may now be further delayed as billionaire businessman Arturo “Arte” Moreno, the owner of the Los Angeles Angels, has indicated that he would like to purchase as many as four of the RSNs.
Billionaire media mogul John Malone is cobbling together a team to bid for the Fox-owned regional sports networks being sold by Disney — and his roster will be going head-to-head against Major League Baseball.
With the $71.3 billion merger of two studios about to close, fears are mounting on the storied Fox lot as colleagues prepare to become rivals, Bob Iger’s every move is scrutinized and 4,000 jobs are about to vanish: “There will be bloodshed.”
Fox Reports Quarterly Earnings Dip
Continuing to put up steady results across its TV and film operations, 21st Century Fox posted a dip in earnings in its fiscal second quarter while reporting “significant progress” toward the closing of the Disney merger. The television segment, which includes the Fox broadcast network, had a soft quarter due to the expense of Thursday Night Football, which Fox debuted as part of a multi-year deal last fall. Television swung to a $22 million loss, with 19% revenue growth on advertising, affiliate and content sales offset by a 24% spike in expenses.
Liberty Media has joined the bidding for the regional sports networks that Disney is trying to sell to finalize a deal with Twenty-first Century Fox, sources told CNBC. Liberty and Major League Baseball have submitted bids in the auction. Disney is selling them in order to complete its $71 billion deal to acquire Fox’s movie production and television assets, which included the regional sports networks. That deal is expected to close within weeks.
Major League Baseball is in the running to buy 21 local TV sports networks being sold by Disney, The New York Post reports. The league has teamed up with the Canada Pension Plan Investment Board to buy all of the networks with the exception of the YES Network, which the Yankees are expected to take hold of, sources said.
The Department of Justice is prepared to put the ball back in Disney’s court for unloading Fox’s regional sports networks, saving Disney from a fire sale and billions of dollars in losses, two sources with direct knowledge of the situation said. Justice is poised to allow Disney to spin off the control of Fox’s 22 regional sports networks to complete its $71 billion deal for Fox, one of the sources said, as opposed to finding an actual buyer.
Disney’s auction of Fox’s chain of local sports TV networks has proven to be such a complicated process that the Mouse House has decided to offer up the networks piecemeal.
Some of 21st Century Fox’s best-known ad-sales executives will leave the company when it closes a large sale of its assets to Walt Disney and streamlines itself into a company known currently as “New Fox” in 2019. The ad unit will be under Marianne Gambelli, a veteran who once led ad sales at NBC, who has been named president of ad sales for the “new” Fox, and will oversee efforts for units like Fox Sports, Fox News Channel, Fox Business Network and Fox Broadcasting that will remain after the $71.3 billion deal closes next year.
Add Major League Baseball to the list of 40-plus suitors for 21st Century Fox’s 22 regional sports TV networks for sale by Disney as a condition of clearing its $71.3 billion purchase of Fox.
Bidding on two prime collections of local TV assets — Fox’s 22 regional sports networks and Tribune Media’s 42 TV stations and WGN America — will heat up this week in separate auctions that are expected to be concluded by year’s end. The nature of the players lining up for these properties, which include Amazon and private equity heavyweights, speaks volumes about the transformation of media economics, particularly for outlets that have historically operated with a narrow regional focus.
Analysts had worried that China might use Disney’s $71.3 billion deal to buy most of 21st Century Fox as a weapon in a trade war with the United States.
When Disney finally closes its deal to acquire 21st Century Fox’s film and TV assets early next year, the company will gain — among many things — ownership of Hulu, which has never before had just one company hold a controlling stake. But with Disney also readying the launch of its own Disney-branded streaming service next year, it will now have ownership of two competing streaming services, which begs the question: How will Disney be able to launch Disney+ while allowing Hulu to continue to grow?
Major League Baseball and 21st Century Fox signed a new rights agreement that will keep the national pastime’s biggest games on Fox Sports and Fox Broadcasting for the next several years. Under the terms of the pact, Fox Sports and Fox Deportes maintain exclusive television broadcast rights to the World Series, one League Championship Series, two Division Series and the All-Star Game.
Yankees Looking To Buy Back YES
The New York Yankees are in talks to buy back YES Network as Disney and Twenty-First Century Fox look to clear their $71.3 billion merger. It amounts to “a foregone conclusion” the Bronx Bombers will exercise their right of first refusal to buy the 80% of YES they don’t own, according to a source familiar with the talks.
Fox 3Q Earnings Top Estimates
Television, which includes the broadcast network and stations, had a stellar quarter, with operating income of $168 million surging 38%, over the prior-year quarter as revenue climbed 20%. The company credited a 22% advertising upswing on World Cup soccer matches and more NFL games than in the year-ago period, plus midterm political ad spending on its O&O TV stations.
The Wall Street Journal reports that big media companies, sports teams, private-equity firms and rapper Ice Cube are among those kicking the tires of nearly two dozen regional sports networks that Disney is divesting as part of its $71.3 billion purchase of 21st Century Fox assets. “There’s never been an instance where a large group of these [regional sports networks] have been sold all at once,” said sports-media consultant Lee Berke. Initial bids on the channels are due Nov. 8. Journal subscribers can read the full story here.
Disney’s sales process for Fox’ 22 RSNs took a big step forward last week when the company sent the official bid book to prospective bidders, according to several sources. Said to be more than 150 pages, the book was sent to networks, digital companies, distributors and investment banks who agreed to sign a non-disclosure agreement. Allen & Co. and JP Morgan Chase are handling the sale for Disney, sources said.
The American Cable Association has a problem with how the Justice Department resolved its antitrust issues with Disney’s purchase of Twenty-First Century Fox assets, including, at least temporarily, its 20 regional sports networks, Prime Ticket and the YES network.
Walt Disney has offered concessions in an attempt to allay EU antitrust concerns over its $71.3 billion bid for 21st Century Fox’s entertainment assets, the European Commission said on Monday. Disney submitted its proposal on Friday, according to a filing on the EU competition enforcer’s website which however did not provide details.
