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Comcast, Verizon in talks to buy Fox's assets

Comcast has steadily boosted its ownership of content over the years

Anjali Athavaley & Liana B Baker | Bloomberg 

Comcast, Verizon in talks to buy Fox's assets

and Communications have both expressed interest in acquiring a significant part of Rupert Murdoch’s Twenty-First Century Inc’s assets, two people familiar with the situation told Reuters on Thursday.

News of competing interest in some of Murdoch’s assets broke even though the US Justice Department was preparing a lawsuit to block AT&T Inc, the largest pay-TV provider in the US, from buying Time Warner for $85.4 billion, according to a source. This raised questions about the US government’s willingness to allow large media industry mergers.

The assets that buyers have expressed interest in include Fox’s movie and TV production studios, cable networks FX and National Geographic, and assets such as the Star network in India, and the European pay TV provider Sky. These units have also been the subject of recent talks between and Walt Disney Co, one of the sources said.

shares jumped nearly 8.0 per cent in after-hours trading after the Wall Street Journal first reported the news. Shares of Viacom Inc and CBS Corp also rose more than 2.0 per cent, a sign investors may see them as potential targets also.

has approached about its interest, and talks are in early stages, the source added, requesting anonymity. There is no guarantee that talks between the companies will result in a deal. Fox, and declined comment.

After first bought a stake in in 2011, buying the assets would give Comcast, the largest cable provider in the US, an distribution footprint through ownership of Sky and Star in India.

Comcast, Verizon in talks to buy Fox's assets

 
has steadily boosted its ownership of content over the years and acquiring Fox's assets would further position as a diversified conglomerate to rival Disney, analysts said. The deal would bulk up its unit, which acquired Dreamworks Animation for $3.8 billion last year, as well as increase its ownership stake in video streaming service Hulu. is also in the early stages of exploring a deal, one of the sources said. A deal could give the US No. 1 wireless phone carrier ownership of movies and TV shows to stream to its mobile subscribers.

Acquisition of a movie studio and cable channels would be a departure for Verizon, which has focused its media deals around advertising technology and internet properties.

spent $4.48 billion acquiring the core business of Yahoo, which it merged with AOL this year to form a venture called Oath. Led by AOL CEO Tim Armstrong, Oath owns more than 50 brands including HuffPost, TechCrunch and Tumblr.

Roger Entner, an analyst of Recon Analytics, said, "It is undeniable that there is a trend of combining content with distribution." Verizon, which has said it is launching a new streaming service, could have more targeted advertising with a vertically integrated platform, he added. Traditional cable television networks have been struggling with faster-than-expected subscriber erosion in the competition with streaming services like Netflix Inc and Amazon.com.

To increase its scale, tried to buy Time Warner three years ago and last year announced its intention to buy the rest of Sky beyond the 39 per cent it already owns. 

The moves also come after the US Federal Communications Commission on Thursday voted to remove key roadblocks to increased consolidation among media companies, potentially unleashing new deals among TV, radio and newspaper owners as they seek to better compete with online media.


DEALS IN FOCUS

News of competing interest in some of Murdoch's assets broke even though the US Justice Department was preparing a lawsuit to block AT&T Inc from buying Time Warner 
The assets that buyers have expressed interest in include Fox's movie and TV production studios, cable networks FX and National Geographic
Its assets include  the Star network in India, and the European pay TV provider Sky 
These units have also been the subject of recent talks between and Walt Disney Co, one of the sources said


First Published: Sat, November 18 2017. 00:08 IST
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