According to people familiar with the situation, 21st Century Fox is discussing a deal that would sell the majority of the company to Walt Disney Co. If it goes forward, the media company would become largely focused on news and sports, relinquishing control of many of its entertainment ventures, allowing it to compete more effectively in the marketplace.
As reported by CNBC, Fox has been talking with Disney for weeks, but it is not yet known whether a deal would be reached.
Disney would likely see the opportunity as a boon, allowing it to acquire another movie studio and substantial television production assets as it prepares to offer a direct-to-customer streaming option. The company recently announced its intention to pull all of its film properties from Netflix and create streaming offerings focused on sports and key franchises, like “Star Wars” and Marvel.
The deal would likely give Disney control of some of the Marvel properties currently controlled by Fox, such as the Fantastic 4, Deadpool and X-Men franchises, which would probably benefit Disney’s long-term plans.
Many people believe that 21st Century Fox lacks the scale necessary to compete in a changing media landscape that has been increasingly dominated by digital distribution and streaming, but Disney has the clout to potentially be successful in that arena. Companies like Netflix, Amazon, Facebook, and Google have changed how people consume media, and Fox may be ill-equipped competitively in that space.
According to those who are familiar with the talks, Disney would not assume control of Fox entirely. Two of Fox’s broadcast networks would not be included in the sale, and much of Fox’s sports programming assets would remain under the control of Fox, as combining them with ESPN may raise concerns in the antitrust arena.
Disney could acquire, along with the movie studio and television production assets, including international stakes in Star and Sky, additional entertainment networks traditionally associated with cable television service, such as FX and National Geographic.
Details about the structure of the deal or any proposed sale price have not been openly discussed, and officials at Disney and Fox have declined to comment on the issue. Additionally, even though talks have occurred, but are not happening currently, there is no guarantee that such a deal would ultimately go forward. However, with the on again, off again nature of the discussions, it is possible the companies will revisit the topic.