Cable company Comcast proposes $66-billion takeover of Walt Disney

[Timon]

FYI:

http://www.mytelus.com/news/article.do?pageID=cp_business_home&articleID=1525240


Wednesday, Feb 11, 2004

Cable company Comcast proposes $66-billion takeover of Walt Disney


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Comcast chief Brian Roberts. (CP PICTURE ARCHIVE/2001/Richard Drew)-->
NEW YORK (AP) - Cable television giant Comcast Corp. proposed Wednesday to buy Walt Disney Co., the iconic media and entertainment powerhouse that owns the ABC and ESPN television networks, movie studios and theme parks, for stock valued at about $54 billion.

America's biggest cable operator also would take on $11.9 billion in Disney debt to push the total value of the deal to $66 billion.

"This is a unique opportunity for all shareholders of Comcast and Disney to create a new leader of the entertainment and communications industry," stated Comcast president and chief executive officer Brian Roberts.

Comcast released a letter sent to Disney chairman and CEO Michael Eisner indicating that Eisner had personally rejected Roberts' offer earlier in the week.

The letter called it "unfortunate" that Eisner was not willing to enter into discussions. "Given this, the only way for us to proceed is to make a public proposal directly to you and your board."

Under the merger proposal, Comcast would issue 0.78 of a share for each Disney share, and Disney shareholders would own 42 per cent of the combined company.

The deal would give Disney shareholders a premium of more than $5 billion, based on Tuesday's stock prices.

The bid comes as Eisner is under attack from shareholders led by Roy Disney, nephew of the company's founder, who contend that the Magic Kingdom has lost its magic in recent years.

© The Canadian Press, 2004

 

[Scratch42]

This is not what Walt would want.

Scratch

 

[MaMudduck]

Actually it my not be as bad as it sounds.

If it get's Michael Eisner out and the Real creative talent back to Disney, that would be a great thing.
Comcast has already stated that they don't intended to "sell off" the theme parks but revive them what that "Disney" magic.

I think it's a real watch & see kind of deal.

Today I've received over 100!!!! email alerts from CBSmarketWatch regarding this Disney deal at first glance I thought Disney was waging a hostile take over of a company, then NO! they were the ones being sought out. Very interest day in the stock world today.

 

[Darkrobe]

Personnally, anything that supercedes the Disney board will be a bad thing as what will happen is a focus on profitable returns. What this means to the Disney 'addict' is:
- Increased prices
- Cutback on staff (to cut costs)
- Possible selloff of non-core assets to generate cash flow to pay debt. You can't hold Corporate America to holding it's promises to NOT do something. Generally, if they say they won't do it, they will just not right away while your memory is short.
- Closure of non-profitable theme parks (Paris probably).
- Limited capital expenditues on new assets. Less rides, bigger lineups.

Eisner isn't the key problem to Disney, what is wrong is that the entire board is stale and has no imagination. Dropping the ball with Pixar is already a bad mistake and compromise should have been done, not strong arming the profits. Pixar deserved better from Disney and they didn't get that.

Tourism is still down from pre 9/11 numbers and limited growth in the industry is still happening so what I am hoping is that things settle down in the near future and Disney holds out and isn't taken over. I don't think I would go to Disney parks anymore knowing that Comcast is in charge and as for the Disney family, I'ld be leading the revolt against this takeover.
I feel bad for Walt's memory, this is totally against what he would have wanted for the business he wanted.

 

[MaMudduck]

Originally posted by Darkrobe
Eisner isn't the key problem to Disney, what is wrong is that the entire board is stale and has no imagination. Dropping the ball with Pixar is already a bad mistake and compromise should have been done, not strong arming the profits. Pixar deserved better from Disney and they didn't get that.

...... for the Disney family, I'ld be leading the revolt against this takeover.
I feel bad for Walt's memory, this is totally against what he would have wanted for the business he wanted.

I'm in agreement with you there! REALLY!

But it's Eisner that has raped & stripped Disney of anything that Walt ever intended. His other board members are a bunch of "yes-men" and it has been him that has left Disney open to this type of hostile take over. I totally support Roy Disney & Stan Gold, in fact, if I haven't sold my shares in the fall of 2003, I would be attending (via proxy at the least) the upcoming shareholders meeting.

Eisner is an ego-manic and is killing Disney....as you said the Pixar Deal, big mistake! Steve Jobs use to be a Disney board member & President of Comcast ( his name escape me at the moment) also use to be on the board of Disney. I see a 'muscle flexing" match going on here.
Eisner is as "Corporate America" as it gets.
His days are numbered....BTW his golden parachute is $600-$900 MILLION dollars

Don't flame me over this....I absolutely want Disney to stay as it own Corporation with the family in control. Someone (Microsoft or GE) now will possibility have to come in and save them. My vote is for Pixar & Steve Jobs as the White Knight