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Here Is the $10 Billion Reason Why Disney May Lose Its Fox Deal

Love triangle provides perfect Hollywood drama

The Walt Disney Company is set to purchase much of 21st Century Fox for $52.4 billion dollars. That’s a ton of money, but it’s nowhere near what Comcast was ready to pay for those pieces on the auction block.

Salivating overs its international businesses, the NBCUniversal parent company pitched a dollar amount to Fox in the low-$60 billion dollars range, a person with knowledge of those initial talks tells TheWrap. Using the definition of the word “low” (and thus, not “mid” or “high”), that means a Comcast takeover could have made Fox shareholders on the whole $10 billion richer.

We’ll write that out for readers to see exactly how long those zeroes go on: $10,000,000,000.

Our insider tells us that an official Comcast bid never actually came in — this all happened during feeler talks. That is in line with what the company said after Disney’s agreement was accepted. This person also tells us that no secondary push from Comcast has since taken place — but these initial conversations resurfacing may force Fox to explain such a significant self-devaluation to shareholders. It’s starting to become a bit of a tough sell.

But before you think Fox screwed up, there could be very good reasons why it chose Disney’s $52 billion to Comcast’s $60 billion-plus. For starters, these purchase prices mean nothing if the deal dies along the way. Regulatory approval can be a nightmare these days — just look at AT&T-Time Warner — and operating a major corporation under such a cloud of mega M&A activity is neither fun nor free.

Somewhere along the way, Fox determined that Disney would make the better (or at least, more likely) parent. In our totally personal fantasy about this scenario, we’d like to think President Trump’s disdain for MSNBC may have reared its ugly head, much like Time Warner’s CNN seems to be a problem for this administration and that see-you-in-court merger. That would be ridiculous, of course, but why stop the absurdity now?

Speaking of keep-on-keeping-on, it’s definitely not too late for Comcast and Fox to combine. After all, the government still gets a say, as do shareholders. And if you owned a whole bunch of Fox stock, which deal would you root for? One could give you up to a 20 percent higher return than the other. You know, assuming Comcast would still pay such a premium now knowing what Fox was willing to take.

While there is no timeline set yet for Fox’s final stockholder vote on the Disney deal, those with a vested interest should circle March 19, 2018 on their calendars: That’s when AT&T and Time Warner will begin their court battle against the Department of Justice. A victory there for the very much for-profit corporations could change a whole heck of a lot in the consolidating media landscape — oh yeah, and make a bunch of major players filthy rich(er).

Fox and Comcast both declined comment on this story.

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