Fox and Walt Disney Start Sale Talks Again

It has been reported by sources that 21st Century Fox, part of the media empire of Rupert Murdoch has resumed talks over a sale with Walt Disney for the majority of its business and that would include its stake in Sky.

Talks between the companies were thought to have broken off during November. However, according to new reports the talks resumed.

Negotiations are believed to include the cable and movie networks of Fox and its international divisions, which Sky is part of.

The remainder of the group, including the Fox broadcast network, Fox News Channel and its rights to sports, are not thought to be a part of the possible sale.

Currently Fox is going through the process of attempting to purchase the remainder of Sky that it already does not own. It now has a stake of 39% in the broadcaster, but wants to take full control.

Regulators have been scrutinizing the deal because of the concerns over the influence level it would give media businesses that are controlled by the Murdoch’s in the media landscape of the UK, as well as worries over the commitment of 21st Century Fox to standards of broadcasting.

A well-known analyst in the media industry said the reported interest by Disney to acquire Fox was a very credible one.

The analyst added that for Disney, being a huge conglomerate a deal that would focus on consolidation would be quite logical and would allow for it to save tens of millions of dollars through combined synergies.

However, the analyst noted that talks would not progress ahead significantly due to the critical auction of the Premier League rights in the UK that is scheduled for 2017, which could potentially affect the valuation of Sky.

A deal with Disney would not prevent the pursuit by Fox of the remainder of shares of Sky.

The discussions for a takeover come with the backdrop of an upheaval across the media industry with viewers shifting towards video online and away from pay-TV subscriptions.

The shift reportedly is what fueled the approach by Disney; combining the extensive offering in entertainment Disney has with Fox could be a way that will counter the increased threat from Netflix and Amazon.

Comcast, the U.S. cable provider, which is the owner of NBCUniversal, and Verizon the telecoms operator are reported to have shown interest in the entertainment assets of Fox.

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