On Wednesday, the Department of Justice approved Disney $71 billion bid for a collection of 21st Century Fox's assets with one caveat: it must sell Fox's 22 regional sports networks, including FSKC, according to multiple reports.
Disney and Comcast have traded jabs over which bid would face an easier path to regulatory approval, an important consideration for Fox stockholders, who must weigh which deal to accept. A July 10 Fox shareholder vote on the Disney deal was postponed to a "future date" to allow more time to evaluate Disney's new offer.
The approval may make it harder for Comcast to win over Fox, which had rejected an earlier bid over concerns about regulatory scrutiny.
The DOJ's approval Wednesday is not the final word on the merger. The proposed settlement requires Disney to divest 22 RSNs, now owned by Fox, to a buyer acceptable to the Department.
The Justice Department's Antitrust Division filed a civil antitrust lawsuit today in the U.S. District Court for the Southern District of NY to block the proposed acquisition.
A strategic investor could team up with Comcast, taking on the U.S. Fox assets that are in play-including the Twentieth Century Fox studio and regional sports networks-while leaving Comcast with worldwide businesses such as European pay TV giant Sky PLC and Star India.
If the latest offer is completed, Disney would get the 20th Century Fox studios along with a controlling stake in Hulu, the online platform created by media groups to challenge Netflix and Amazon. While not unexpected, the quick decision by the Justice Department gives Disney a massive advantage over Comcast as things stand.
Currently, Fox's regional sports networks have more than 60 million subscribers and local rights to a majority of baseball and basketball teams.
The seemingly unending saga of which media giant will acquire large swaths of 21st Century Fox's assets has just crossed an important legal hurdle.
Without divestitures, the transaction would be anti-competitive, the DOJ complaint said. With this deal, Disney will get ownership of 20th Century Fox movie and television studio, cable channels including FX and National Geographic, and Fox's portfolio of global operations, including a fast-growing pay-TV service in India.