As the saying goes, it’s been “one of the worst-kept secrets” in Hollywood the past few weeks, but now it’s as official as it can be… a press release was issued this morning to confirm that “The Walt Disney Company to Acquire 21st Century Fox, Inc. after spin-off of certain businesses.” Now, for the casual reader that doesn’t necessarily follow the business side of entertainment, 21st Century Fox is indeed what you know as 20th Century Fox – the result of a corporate name change that happened back in 2013. Bottom line is that Disney will now control the Twentieth Century Fox Film and Television studios, along with cable and international TV businesses. What’s important to note is that 21st Century Fox will separate the Fox Broadcasting network and stations into a newly-listed company that will be spun-off to its shareholders prior to the acquisition. That means that Disney will not take ownership of Fox News Channel, Fox Business Network, FS1, FS2 or Big Ten Network. So what will happen for fans of the great content that Disney and Fox have been producing? All signs point to good things. More below…
In the lengthy statement that was released today (those interested in financials can look here), there’s two particular passages that that really drive home what this is all about – entertainment…
Popular Entertainment Properties to Join Disney Family
Combining with Disney are 21st Century Fox’s critically acclaimed film production businesses, including Twentieth Century Fox, Fox Searchlight Pictures and Fox 2000, which together offer diverse and compelling storytelling businesses and are the homes of Avatar, X-Men, Fantastic Four and Deadpool, as well as The Grand Budapest Hotel, Hidden Figures, Gone Girl, The Shape of Water and The Martian—and its storied television creative units, Twentieth Century Fox Television, FX Productions and Fox21, which have brought The Americans, This Is Us, Modern Family, The Simpsons and so many more hit TV series to viewers across the globe. 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.
“The acquisition of this stellar collection of businesses from 21st Century Fox reflects the increasing consumer demand for a rich diversity of entertainment experiences that are more compelling, accessible and convenient than ever before,” said Robert A. Iger, Chairman and Chief Executive Officer, The Walt Disney Company. “We’re honored and grateful that Rupert Murdoch has entrusted us with the future of businesses he spent a lifetime building, and we’re excited about this extraordinary opportunity to significantly increase our portfolio of well-loved franchises and branded content to greatly enhance our growing direct-to-consumer offerings. The deal will also substantially expand our international reach, allowing us to offer world-class storytelling and innovative distribution platforms to more consumers in key markets around the world.”
“We are extremely proud of all that we have built at 21st Century Fox, and I firmly believe that this combination with Disney will unlock even more value for shareholders as the new Disney continues to set the pace in what is an exciting and dynamic industry,” said Rupert Murdoch, Executive Chairman of 21st Century Fox. “Furthermore, I’m convinced that this combination, under Bob Iger’s leadership, will be one of the greatest companies in the world. I’m grateful and encouraged that Bob has agreed to stay on, and is committed to succeeding with a combined team that is second to none.”
At the request of both 21st Century Fox and the Disney Board of Directors, Mr. Iger has agreed to continue as Chairman and Chief Executive Officer of The Walt Disney Company through the end of calendar year 2021.
“When considering this strategic acquisition, it was important to the Board that Bob remain as Chairman and CEO through 2021 to provide the vision and proven leadership required to successfully complete and integrate such a massive, complex undertaking,” said Orin C. Smith, Lead Independent Director of the Disney Board. “We share the belief of our counterparts at 21st Century Fox that extending his tenure is in the best interests of our company and our shareholders, and will be critical to Disney’s ability to effectively drive long-term value from this extraordinary acquisition.”
Benefits to Consumers
The acquisition will enable Disney to accelerate its use of innovative technologies, including its BAMTECH platform, to create more ways for its storytellers to entertain and connect directly with audiences while providing more choices for how they consume content. The complementary offerings of each company enhance Disney’s development of films, television programming and related products to provide consumers with a more enjoyable and immersive entertainment experience.
Bringing on board 21st Century Fox’s entertainment content and capabilities, along with its broad international footprint and a world-class team of managers and storytellers, will allow Disney to further its efforts to provide a more compelling entertainment experience through its direct-to-consumer (DTC) offerings. This transaction will enable Disney’s recently announced Disney and ESPN-branded DTC offerings, as well as Hulu, to create more appealing and engaging experiences, delivering content, entertainment and sports to consumers around the world wherever and however they want to enjoy it.
The agreement also provides Disney with the opportunity to reunite the X-Men, Fantastic Four and Deadpool with the Marvel family under one roof and create richer, more complex worlds of inter-related characters and stories that audiences have shown they love. The addition of Avatar to its family of films also promises expanded opportunities for consumers to watch and experience storytelling within these extraordinary fantasy worlds. Already, guests at Disney’s Animal Kingdom Park at Walt Disney World Resort can experience the magic of Pandora—The World of Avatar, a new land inspired by the Fox film franchise that opened earlier this year. And through the incredible storytelling of National Geographic—whose mission is to explore and protect our planet and inspire new generations through education initiatives and resources—Disney will be able to offer more ways than ever before to bring kids and families the world and all that is in it.
Bob Iger (who I respect immensely) stays on through 2021… the Marvel characters finally come home… rights to the first Star Wars movie are cleared-up (now how about that 4K reissue?)… Avatar comes to Disney after already having a presence in the parks… I dig it. Now there will be some things that have to be ironed out, the first of which is that this deal could take a year or two to formally close, and that’s thanks to regulatory reviews by the government. There’s also going to be some interesting conversations about rights that Fox may have farmed-out elsewhere, such as The Simpsons having attractions at Universal Studios Theme Parks. Much like certain Marvel characters being shared between Disney Parks and Universal, someone somewhere has some complicated dealings to address.
Pictured Top: Robert Iger and Rupert Murdoch. Credit: The Walt Disney Company