In a marked turn from its dealings with AT&T and TimeWarner, the Justice Department announced Wednesday it has approved a $71.3 billion deal between The Walt Disney Corporation and 21st Century Fox for most of the latter’s business. The deal was originally announced in December 2017, with Disney offering $52 billion for much of Fox’s assets.
The deal is sealed on one condition – selling off Fox’s 22 regional sports networks. Disney already owns ESPN and its numerous spin-offs.
Disney gets 90 days to sell off the RSNs; it can ask for a 90-day extension. The approval by the government is seen as a huge advantage for Disney over Comcast, who has expressed interest in the Fox properties.
The move drew praise from several industry organizations, including the American Cable Association. They felt if Disney kept the RSNs, it would lead to higher prices overall and would have tremendous leverage given their ownership of ESPN.
But it’s not over yet.
Comcast is looking to recruit private equity firms to top the $71.3 billion offer from Disney. Fox can still consider other offers, including from Comcast. And a major investor in 21st Century Fox – TCI Investments said Fox should wait to hear a competing bid from Comcast.
As reported here earlier this week, the current bidding war between Disney and Fox over the properties could have an impact on the Cubs’ plans to launch their own regional sports network. With Disney and Fox out of the running, the Cubs do not have a lot of options other than AT&T, who could make a play for the orphan RSNs and add them to their existing properties.
Other suitors could be Charter Communications, Mediacom, and even tech companies such as Google, Facebook, and Apple, but the latter is a long shot.
Charter has Spectrum SportsNet in Los Angeles with separate channels for the Lakers and Dodgers.