Comcast could reignite a bidding war for the Fox assets that Disney is buying for $52.4 billion if the Justice Department loses its court challenge to block AT&T’s $85 billion Time Warner acquisition.
According to Fox Business’ Charlie Gasparino, Comcast CEO Brian Roberts thinks if AT&T and Time Warner are allowed to move ahead with their merger, it could open the door for Comcast to successfully outbid Disney for Fox’s assets.
The trial pitting the DOJ against lawyers defending the AT&T-Time Warner merger wrapped up earlier this week, but a decision isn’t expected until June 12, when Judge Richard Leon has scheduled a hearing.
Word among Wall Street analysts and industry insiders is that AT&T has a strong chance of winning the case. MoffettNathanson analyst Craig Moffett was careful to note that while he still thinks AT&T has a 50-50 chance, many believe the odds are better than that.
“By most accounts, however, the trial has gone very well for AT&T. For the record, we’re still calling it a toss-up, but the general consensus is that we’re being too cautious; most observers seem to give AT&T 75%-or-better odds of winning in Court,” Moffett wrote in a research note.
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Comcast has already officially counterbid for Sky, a European pay TV operator that Disney would own if its Fox deal were approved.
“We didn’t choose to put Sky in play—that was done for us,” Roberts said somewhat defensively during Comcast’s first-quarter earnings call. “I don’t think we have to do this. And I don’t think of international broadly as a strategy. The fact is, Sky is a unique asset that fits the list of assets we already have.”
As Disney is pursuing its deal with Fox, Fox is also pursuing a deal to buy the 61% of Sky it doesn’t already own. Last month, U.K. regulators said that Disney will be required to make a bid for European satellite operator Sky if its deal for 21st Century Fox’s assets closes before Fox can finalize its bid to buy the rest of Sky.
Per Disney’s deal with Fox, Disney will take ownership of film businesses including Twentieth Century Fox, Fox Searchlight Pictures and Fox 2000, and television creative units Twentieth Century Fox Television, FX Productions and Fox 21. Disney will also acquire FX Networks, National Geographic Partners, Fox Sports Regional Networks, Fox Networks Group International, Star India and Fox’s interests in Hulu, Sky plc, Tata Sky and Endemol Shine Group.