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Comcast Confirms Plan To Buy 21st Century Fox and Control of Hulu (arstechnica.com)
Comcast is reportedly preparing an offer to buy major portions of 21st Century Fox, which would give it majority control of Hulu and other media properties. Ars Technica reports: Walt Disney Company already has a $52.4 billion all-stock deal to buy the 21st Century Fox properties. But Comcast was rumored to be lining up $60 billion in financing in order to make a hostile bid for the Fox assets, and Comcast's announcement today confirms it. Comcast "is considering, and is in advanced stages of preparing, an offer for the businesses that Fox has agreed to sell to Disney," Comcast's announcement said. Comcast is working on the offer in preparation for shareholder meetings in which the Disney/Fox deal will be considered.
The Fox properties for sale do not include assets such as the Fox News Channel, Fox Business Network, and Fox Broadcasting Company. Those properties would be spun off into a company being referred to as "New Fox," and Comcast would acquire 21st Century Fox after the spinoff. The Fox sale to either Disney or Comcast would include 21st Century Fox's film and television studios; cable entertainment networks; the Fox Sports Regional Networks; and international properties including Star in India and Fox's 39-percent ownership of Sky across Europe. The sale would also include Fox's 30-percent stake in Hulu, the popular online video streaming service. Comcast already owns 30 percent of Hulu, so a deal with Fox would give the nation's largest cable company majority control over the online video provider.
The Fox properties for sale do not include assets such as the Fox News Channel, Fox Business Network, and Fox Broadcasting Company. Those properties would be spun off into a company being referred to as "New Fox," and Comcast would acquire 21st Century Fox after the spinoff. The Fox sale to either Disney or Comcast would include 21st Century Fox's film and television studios; cable entertainment networks; the Fox Sports Regional Networks; and international properties including Star in India and Fox's 39-percent ownership of Sky across Europe. The sale would also include Fox's 30-percent stake in Hulu, the popular online video streaming service. Comcast already owns 30 percent of Hulu, so a deal with Fox would give the nation's largest cable company majority control over the online video provider.
People cut the cord because the pricing model sucks, it's not like any of these companies aren't ultimately on a scale between immoral and malevolent.
If I read correctly that do not actually have the *cash* to pay for this takeover, but will finance the operation. Given how recently ToysRUs had a very slow and painful death due to a similar leveraged buyout, I do not expect this one to go well either.
According to their financials, Fox made ~3bn last year in profits:
https://finance.yahoo.com/quot...
This means it will take 20 years for them to pay off the 60bn debt. This assumes no investment in R&D, staff, or paying dividends. (That is why ToysRUs become unable to compete, they had no profit margin left after payments).
Comcast is in a better position with 20bn in profits:
https://finance.yahoo.com/quot...
However will they skim from shareholder dividends to pay for Fox operations? It looks like they are already down by about 2%, meaning the idea is not liked on the market.
And this is before anything about the customers. They would want to milk every *value* out of current customers, meaning worse service and/or higher prices across the board.
I do not have any shares in any of these companies, however if I had one, I would have voted against such a merger. (for clarification, I'm no financial expert, this is my personal opinion, don't act on it)