Disney & 21st Century Fox shareholders vote in favour of $71.3b mega-merger

Shareholders of 21st Century Fox and Disney met up at the New York Hilton last Friday and voted in separate meetings in favour of Disney’s $71.3 billion buyouts of Rupert Murdoch’s major Fox assets.

The process began last December and was given the go-ahead by the US Justice Department last month.

21st Century Fox’s general counsel Gerson Zweifach told Fox shareholders that the merger will finalise in the first half of 2019, and promised of how financially significant it would be of them.

The Fox vote took all of eight minutes.

The Disney meeting, led by general counsel Alan Braverman and CFO Christine McCarthy, lasted for 11 minutes, and received just one vote against (the dissenter thought the price too high).

The Disney Fox deal will give Disney a stake in the control of Fox subsidiaries as its film studio, the Hulu streaming service, the FX Networks and National Geographic channels; and Indian media company Star, Tata Sky, and Endemol Shine Group.

Disney now owns the film rights to X-Men, Avatar, Fantastic Four, Deadpool, The Grand Budapest Hotel, Hidden Figures, Gone Girl, Planet of the Apes, Ice Age, The Shape of Water and The Martian.

It also gets TV rights for dozens of shows including The Simpsons, Family Guy and The Americans.

Around 5,000 to 10,000 Fox employees are expected to be laid off once regulatory approval is granted in various countries, and many Fox projects in development are guaranteed to be cancelled.

Fox chairman-CEO Rupert Murdoch said “We expect the enlarged Disney and new ‘Fox’ companies will be pre-eminent in the entertainment and media industries.”

Disney and Fox/Fox Searchlight currently have 48% market share at the 2018 US box office.

Having almost a 50% control by a single entity is unprecedented.

In addition to this new Disney massive footprint in the global entertainment sector, it is also rumoured to be launching a streaming service next year to take on Netflix and Amazon.

Disney’s long-term plan is to abandon cable and satellite for a “direct-to-consumer strategy” which Disney CEO Bob Iger believes is “vital to the future of our media businesses” and the company’s “highest priority.”

Between 5,000 and 10,000 Fox staffers are expected to lose their jobs.

Iger will stay on as Disney CEO until late 2021 to oversee the integration of Fox’s businesses into Disney’s corporate culture.

Disney had to fight off Comcast for Fox assets.

Disney started out in December with a bid of $52.4 billion of stock, which Comcast responded to with $65 billion all-cash.

After Disney responded with 71.3 billion consisting of cash and stock, Comcast then turned its focus on British media giant Sky with an opening bid of $34 billion.