New $71.3 billion Disney bid for Fox tops Comcast’s

Disney will also take on about $13.8 billion of Fox's net debt, implying a total transaction value of about $85.1 billion.

The move comes a week after Comcast, the US cable giant, offered $65bn in cash for the assets, which include 20th Century Fox - the Hollywood film studio behind hits such as Avatar, X-Men and Ice Age - US cable TV networks including FX and National Geographic and global pay television assets including Star TV in India. This valuation is a $3 premium over Comcast's $35 a share all-cash offer that they made just last week. This bid is not only $18.9 billion higher than its original bid in December but it has also changed its terms, which had originally offered only stock, to offer a 50/50 split between a cash and stock payout.

Granted, even if Fox agrees to a deal, the merger would still be subject to approval by the Federal Trade Commission.

"Comcast's balance sheet may preclude it from bidding much higher", Sweeney said.

The fight for 21st Century Fox comes as traditional media groups scramble to consolidate in the face mounting competition from online challengers like Netflix and Amazon.

The roughly $71.1 billion package from Disney now includes a cash component, which is meant to combat the all-cash bid offer from Comcast.

The collar on the stock consideration will ensure that 21st Century Fox shareholders will receive a number of Disney shares equal to $38 in value if the average Disney stock price at closing is between $93.53 and $114.32.

Speaking to Deadline, Fox executive chairman Rupert Murdoch said, "We are extremely proud of the businesses we have built at 21st Century Fox, and firmly believe that this combination with Disney will unlock even more value for shareholders as the new Disney continues to set the pace at a dynamic time for our industry". But a sky-high Comcast bid will make that tricky. Additionally, Disney CEO Bob Iger told analysts Wednesday morning, "We are already six months into the regulatory process and we are confident we have a clear and timely path to approval". Earlier this spring, the Fox board had decided that a deal with cable giant Comcast would pose too great a regulatory risk to pass muster with lawmakers, although in the wake of the AT&T-Time Warner merger, those concerns may no longer hold water.

Fox shares jumped 8 percent to $48.23, while Comcast rose 2.1 percent to $33.52.

Fox said it will postpone its special shareholders meeting in order to provide stockholders with an opportunity to evaluate Disney's amended offer.

21st Century Fox is one of the world's leading portfolios of cable, broadcast, film, pay TV and satellite assets spanning six continents across the globe.

If Disney doesn't want to reach above $80 billion, one option may be to look for detente with Comcast by splitting up Fox's assets.

  • Jacqueline Ellis