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Disney Stock Squeaks and Drops After Closing $71 Billion Fox Deal
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Disney has finalized its $71 billion acquisition of Fox in a deal that will reshape the global entertainment industry.( Source: Drew Angerer/Getty Images
With Disney's acquisition of Fox's entertainment assets at a price of $71.3 billion, the House of Mouse has one less big Hollywood studio to compete against.
But despite the deal reducing the number of rivals and potentially increasing its market share, Disney's stock fell by nearly 3 percent after the deal closed. Though it slightly recovered in after-hours trading, the share had fallen 2.76 percent by market close to $110.
The Walt Disney Company's stock price | Source: Yahoo Finance
Disney expects the deal to help it grow internationally. Among the assets that the entertainment giant acquired from 21st Century Fox that will assist in this endeavor include the Dutch-based media firm Endemol Shine Group famous for its hit reality show Big Brother. Others include India's media conglomerate Star India and India's satellite television provider Tata Sky.
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Disney's acquisition of Fox's original content production businesses will also allow it to expand offerings of its planned Netflix-killer, Disney+. The chairman and CEO of Disney, Bob Iger, stated that the deal will result in 'significant long-term value' for the firm and shareholders:
Combining Disney's and 21st Century Fox's wealth of creative content and proven talent creates the preeminent global entertainment company, well positioned to lead in an incredibly dynamic and transformative era.
With the deal, Disney now has ownership of movie franchises such as X-Men, Deadpool and Fantastic Four. Long-running animation comedy The Simpsons will also be joining the House of Mouse.
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As would be expected the animation comedy used its own brand of humor to mark the occasion. In a tweet published by the show's executive producer Al Jean, Homer is seen strangling Disney's iconic character, Mickey Mouse.
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.@TheSimpsons Thank you Fox and welcome Disney! pic.twitter.com/01uPrPsf7r
— Al Jean (@AlJean) March 19, 2019
While Disney is touting the benefits of the deal, it has become a source of anxiety for Fox employees, according to Variety. The deal will reportedly result in the loss of at least 4,000 jobs. Disney estimates that operating efficiencies resulting from the deal will generate savings of over $2 billion by 2021.
"As many as 4,000 jobs are expected to be cut in the process, but the expectation is that the first round of layoffs will hit more senior executives who carry higher salaries". https://t.co/mds43jW4Nm
— Waldo Lydecker (@Waldo_Lydecker) March 20, 2019
21st Century Fox has now been renamed Fox Corp after shedding its entertainment businesses . On the Nasdaq Fox Corp will be trading under the FOXA and FOX tickers.
Former House Speaker Paul Ryan, Who Retired to 'Spend More Time With Family', is now on Fox's Board
Fox Corp which will now have under its umbrella assets such as Fox Business, Fox News and a slate of sports channels and broadcast TV stations has appointed former Speaker of the U.S. House of Representatives, Paul Ryan as a board member. Some fans of Fox News were outraged by the appointment saying it was a stab at President Donald Trump.
Fox News, Fox Corp doesn't care about it's base or President Trump …that's for certain! https://t.co/qj2KAT27U8
— Wayne Dupree | 🎤 (@WayneDupreeShow) March 19, 2019
Ryan has on several occasions differed with the president. Most recently Ryan seemed to suggest that in the upcoming U.S. presidential election, Trump could lose if he focuses on 'personality' at the expense of policy according to Politico:
The person who defines that race is going to win the race. If this is about Donald Trump and his personality, he isn't going to win it.
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Mark Emem
After words, numbers are my other love... mostly when they are going up and they have nothing to do with taxes or expenses. That makes green my favorite color! Currently a resident of Nairobi, Kenya. Follow me @cointributor or email kointributor[at]gmail.com
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