The Walt Disney
Company is in advanced discussions to buy significant parts of 21st Century Fox, the media company run by the Murdoch family, people briefed on the matter said on Tuesday.
And a deal between the two companies
could end up splitting up the Murdochs as an operating team, with James Murdoch potentially leaving his father and brother to work at Disney.
Fox is also in negotiations with Comcast, but the talks with Disney
are moving faster, these people said. An agreement with Disney
could be announced as soon as next week, these people added, speaking on the condition of anonymity because the discussions are confidential.
If a deal is reached, it would be the latest instance of upheaval in the media industry, as giants like Disney
seek to get even bigger to compete against newer players like Netflix. And medium-size companies
like Fox are under pressure to also gain scale through acquisitions or to shrink and focus on specific businesses.
Under the terms of the talks, Disney
would buy big parts of Fox’s empire in an all-stock transaction, including its movie and television studios, international
assets like the Star cable and media company
in India and a stake in the British broadcaster Sky, and a stake in the Hulu streaming service, these people said.
James Murdoch, Fox’s chief executive, could take a senior executive role at Disney
with oversight of the Sky and Star companies
as part of his portfolio, these people added.
Adding assets like the Fox movie and television studios would give Disney
more sources of content at a time when it is rolling out its own streaming video service to challenge companies
like Netflix and Amazon. And Star and Sky would help give Disney
For Fox, a transaction with Disney
might pose fewer regulatory risks than one with Comcast
because the latter would bear some similarities to AT&T’s proposed takeover of Time Warner — which the Justice Department is seeking to block.
What would be left of 21st Century Fox
would be several highly profitable operations, including Fox News Channel, a broadcast network and the FS1 sports channel. It would be overseen by Rupert Murdoch and his other son, Lachlan, who are executive chairmen of the company.
The Murdoch family also still controls News Corporation, a separate publicly traded company that owns The Wall Street Journal, the British newspaper The Times and other news publications.
News of the latest state of the talks was reported earlier by CNBC and The Financial Times.