Comcast Drops Bid For 21st Century Fox

Comcast Corp said on Monday it had abandoned its bid for most of the assets of Rupert Murdoch’s Twenty-First Century Fox Inc, leaving Walt Disney Co as the sole suitor in pursuit of the $40 billion-plus deal.

Sources told Reuters last week that Disney was in the lead to acquire the assets, which include Fox’s FX and National Geographic cable channels, its movie studio, the Star network in India and stake in European pay-TV provider Sky PLC.

The Murdoch family, which controls Fox, prefers a deal with Disney because it would rather be paid in Disney stock than Comcast stock, and expects a potential deal with Disney to be cleared by U.S. antitrust regulators more easily, one of the sources said.

Comcast, the biggest cable provider in the United States, said in a statement on Monday that its discussions with Fox had ended.

“When a set of assets like Fox’s becomes available, it is our responsibility to evaluate if there is a strategic fit that could benefit our company and our shareholders,” Comcast said. “That is what we tried to do and we are no longer engaged in the review of those assets. We never got the level of engagement needed to make a definitive offer.”

The assets in question would have expanded Comcast’s international footprint through ownership of Sky and Star. A source told Reuters in mid-November that Comcast had approached Fox about its interest, and talks were in early stages.

Disney’s negotiations with Fox are continuing, and a deal could be reached as early as this month, sources close to the situation said on Monday. The persons asked not to be identified because the deliberations are confidential.

Not for sale are the Fox News and Fox Business channels, the Fox broadcast network and its local television stations, which would remain part of a stand-alone company. Its national sports channel Fox Sports 1 also isn’t part of any deal with Disney, which is the parent company of ESPN, according to The Wall Street Journal.

A deal would give Disney intellectual property from 21st Century Fox’s television and movie libraries as well as additional cable channels, plus a controlling interest in Hulu. The online video platform is a joint venture between Disney, 21st Century Fox and Comcast, which each own 30% of Hulu, and Time Warner, which has a 10% stake.