Jun 27, 2018

Disney wins antitrust approval for Fox entertainment assets

Rebecca Zisser

Walt Disney Co. has been granted government approval to acquire 21st Century Fox's entertainment assets for $71.3 billion, by agreeing to divest Fox's 22 regional sports networks (RSNs) as a part of the deal approval process.

Why it matters: Comcast is expected to again top Disney's bid for the same properties in the coming weeks, but the swift regulatory approval for Disney could make it more appealing for Fox shareholders to favor Disney's bid over Comcast's.

Why regional sports? The Justice Department previously filed a complaint against Disney acquiring Fox's 22 regional sports networks, arguing it would give Disney's ESPN an anti-competitive edge over other sports networks.

How it works: The DOJ has entered into a consent decree with Disney and 21st Century Fox that allows the acquisition to proceed, as long as the deal also involves the sale of Fox's RSNs.

  • Under the consent decree, Disney will have at least 90 days from the date of closing the transaction to complete the sale of the networks, with the possibility that the DOJ can grant extensions for up to another 90 days, according to a statement from Disney.

Swift approval was expected, given the fact that a Disney-Fox merger would be "horizontal" — a merger between two companies in a similar business (content). Experts thought that in this case, a horizontal merger would pose less of an anti-competitive threat than if Fox had engaged in a "vertical" merger, selling its assets to a distribution company, like Comcast.

  • The Justice Department's antitrust chief alluded to a swift approval process last month, when he said the deal was "surgically" cut for approval.
  • Many saw this as a sign to Fox shareholders that the Comcast merger would, as expected, face greater regulatory scrutiny.

The bigger picture: Comcast has been trying to to outbid Disney for the same Fox properties for months, but Fox has been more cautious in its efforts, having previously cited concerns over regulatory approvals.

What's next? Despite regulatory complications, Comcast is expected to submit yet another bid to top Disney's $38 per share offer in the coming days.

  • Sources say that Comcast's new bid would likely hit the low to mid $40s per share range.
  • It will then be up to Fox's stakeholders to determine how much higher Comcast's bid would need to be in order to risk a more complicated regulatory process to get that bid approved.

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Venice Beach in Los Angeles on May 24. Photo: David McNew/Getty Images

Authorities urged Americans to maintain social distancing and wear masks against the coronavirus amid reports of packed beaches and bars during the Memorial Day weekend.

Driving the news: Law enforcement stepped up beach patrols, authorities on Florida's Gulf Coast closed parking lots because they were full and there were crowded scenes at Lake of the Ozarks bars in Missouri, per AP, which reports a shooting injured several people at a packed Daytona Beach in Florida.

Coronavirus dashboard

Illustration: Aïda Amer/Axios

  1. Global: Total confirmed cases as of 9:30 p.m. ET: 5,405,029 — Total deaths: 344,997 — Total recoveries — 2,168,408Map.
  2. U.S.: Total confirmed cases as of 9:30 p.m. ET: 1,642,021 — Total deaths: 97,698 — Total recoveries: 366,736 — Total tested: 14,163,195Map.
  3. World: White House announces travel restrictions on Brazil, coronavirus hotspot in Southern Hemisphere Over 100 coronavirus cases in Germany tied to single day of church services — Boris Johnson backs top aide amid reports that he broke U.K. lockdown while exhibiting symptoms.
  4. Public health: Officials are urging Americans to wear masks headed into Memorial Day weekend Report finds "little evidence" coronavirus under control in most statesHurricanes, wildfires, the flu could strain COVID-19 response
  5. Economy: White House economic adviser Kevin Hassett says it's possible the unemployment rate could still be in double digits by November's election — Public employees brace for layoffs.
  6. Federal government: Trump attacks a Columbia University study that suggests earlier lockdown could have saved 36,000 American lives.
  7. What should I do? Hydroxychloroquine questions answeredTraveling, asthma, dishes, disinfectants and being contagiousMasks, lending books and self-isolatingExercise, laundry, what counts as soap — Pets, moving and personal healthAnswers about the virus from Axios expertsWhat to know about social distancingHow to minimize your risk.
  8. Other resources: CDC on how to avoid the virus, what to do if you get it, the right mask to wear.

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Updated 1 hour ago - Politics & Policy

Republicans sue California over mail-out ballot plan

California Gov. Gavin Newsom during a February news conference in Sacramento, California. Photo: Justin Sullivan/Getty Images

President Trump accused Democrats of trying "Rig" November's general election as Republican groups filed a lawsuit against California Sunday in an attempt to stop Gov. Gavin Newsom (D) from mailing ballots to all registered voters.

Driving the news: Newsom signed an executive order this month in response to the coronavirus pandemic ensuring that all registered voters in the state receive a mail-in ballot.