Fox shares ended higher in the US Wednesday as the US Justice department cleared Walt Disney’s proposed purchase of certain Fox entertainment assets. The decision, which Walt Disney said it was pleased with, had just one condition – that Walt Disney sell the regional sports network assets.
Fox shares closed 2.35% higher at $48.80. Meanwhile, Walt Disney shares ended the US Wednesday trading session 0.29% lower at $103.96. Both stocks are higher in out-of-hours activity.
US antitrust division approves Fox-Disney deal
Following an investigation into Disney’s $71.3 billion purchase offer of many of 21st Century Fox’s entertainment assets, including Fox studios, the US Justice Department found only one concern with the deal.
“The Department of Justice announced today that it will require The Walt Disney Company to divest 22 Regional Sports Networks (“RSNs”) as a condition of its $71.3 billion acquisition of certain assets from Twenty-First Century Fox, Inc,” the antitrust division of the department said.
“American consumers have benefitted from head-to-head competition between Disney and Fox’s cable sports programming that ultimately has prevented cable television subscription prices from rising even higher,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division.
“Today’s settlement will ensure that sports programming competition is preserved in the local markets where Disney and Fox compete for cable and satellite distribution,” he added.
Disney happy with US approval terms
Following the US antitrust approval, Walt Disney issued a press release detailing the terms and is thoughts on them.
“We are pleased that the DOJ concluded that, with the exception of the proposed acquisition of the Fox Sports Regional Networks, the transaction will not harm competition, and that we were able to resolve the limited potential concerns to position us to move forward with this exciting opportunity that will enable us to create even more compelling consumer experiences,” the iconic US media and entertainment firm stated.
That condition was likely expected, as Disney already owns ESPN and other local sports channels.