lockedoutlogic
DIS Veteran
- Joined
- Apr 26, 2007
They don't necessarily have to sell it, they could spin it off. It's a common trick used to protect a company from its "negative assets".
The problem is that right now ESPN isn't a negative. It's a huge revenue source and will be for at least 5 years. Only in the absurd world of Wall Street is this a reason to jump out of windows. If the board of directors wasn't so dependent on shareholders they would adjust earnings forecasts down, implement a strategy to expand revenue in other areas over the next decade to compensate and everyone would applaud their rational approach to business. Unfortunately they are dependent on shareholders so we'll get stock buybacks, firings and other stupidity.
Eventually though, spinning it off would be my bet for what happens.
I think you answered your own question...they won't do that.
The problem with ESPN...since Eisner...is that it has been "free money"...the ad revenue and cable fees produced guaranteed, liquid capital.
A bunch of suits like Bobby and the Boys have no idea how to handle the news that their free money is coming to an end. Or will eventually.
They get snakebit