Rupert Murdoch's 21st Century Fox has restarted talks with Walt Disney over the sale of its entertainment and international assets – including its 39 per cent stake in the pan-European broadcaster Sky – in a potential deal that could reshape the global media map.
The discussions between the two sides ended last month but have begun again, according to multiple people with knowledge of the talks. The negotiations have centred on Fox’s movie studio, cable channels, such as FX, and international businesses, such as Star of India and Sky.
If a deal is agreed it would not end Fox’s protracted pursuit of the shares it does not already own in Sky. A Fox-Disney combination would be subject to US regulatory review which would be likely to overlap with a ruling on whether Fox can complete its takeover of the TV broadcaster.
Fox has a market value of close to $60 billion and MoffettNathanson analysts estimate that the assets that could be sold might be worth up to $50 billion. The remainder of the group, including Fox News Channel, Fox broadcast network and its sports rights, would not be sold, say people with knowledge of the talks.
Senior executives from Fox and Disney were both in New York last week although it is unclear if they met to discuss a deal.
Sky takeover
Fox is separately trying to complete the takeover of Sky – the second time in a decade it has tried to buy the company in which it holds a 39 per cent stake – but has run into regulatory quicksand, with the competition and markets authority scrutinising the deal following months of review by Ofcom, the UK media watchdog.
Sky has also threatened to close its Sky News network if the deal is not cleared.
Comcast, the US cable group that owns NBCUniversal, and Verizon, the telecoms operator, have also expressed interest in Fox's entertainment assets and buying businesses that took Mr Murdoch years to assemble.
Fox’s discussions with potential buyers have been driven by an acknowledgment that it lacks the scale or breadth of content to compete with technology groups that have built global digital streaming businesses.
– Copyright The Financial Times Limited 2017
