Will this save Disney?

[manning]

Disney buys Dreamworks and Eisner gets the boot.

Someone out there in the business world floated this idea.

 

[WDSearcher]

Why would Eisner get the boot if Disney bought DreamWorks? It's certainly not an automatic, "If A, then B" scenario.

And, more importantly, why would Disney buy DreamWorks? Why would anyone buy DreamWorks? Other than Shrek -- which basically hangs its hat on making fun of Disney -- they don't have any huge asset that people are clamoring for.

 

[Peter Pirate]

If Disney buys Echostar they will be saved from the current round of raiding...

 

[DisneyKidds]

Why might Disney want a company like Dreamworks? Not for the fit or assets necessarily, but to increase the size of the company, making it unattractive to Comcast due to the inflated price tag. Any talk of Disney acquiring anybody is simply for such a defense purpose.

As for Dreamworks, it is hard to say if acquiring them would aid in the defense. They are a private company and I have no idea what their value is. How much would Disney have to pay for Dreamworks? Big question. Certainly the other big question is whether Spielberg, Geffen, Allen, and most of all Katzenberg would have any interest. It seems it would have to be a friendly merger since I don't know that you can initiate a hostile takeover of a private company.

Echostar seems to be the leading target for such a defense, with a market cap of about $18 billion (meaning it would cost Disney about $18 billion give or take a few billion to acquire them, raising the pricetag for Disney to $85 billion or so - much too large for Comcast to swallow.)Several other companies (such as MGM) have been mentioned as potential takeover targets for Disney, but with market caps inthe $4 billion dollar range they wouldn't grow the size of the Walt Disney Company enough to dissuade Comcast.

It will be interesting to see what Comcast's second offer is. Speculation seems to be that it will be in the $30 to $31 per share range. Of course speculation is that the board (and Disney shareholders) may want something in the $34 to $35 per share range. Of course that would give Disney stockholders more ownership in the combined company.................................

Yes, it should be interesting.

 

[Planogirl]

Dreamworks has been struggling to establish itself in the animated market but truthfully who hasn't lately besides Pixar? Dreamworks isn't just about animation with such films as Catch Me If You Can, Gladiator and Saving Private Ryan to its credit. The company is also involved in music and video games.

My point is that Dreamworks is far from the most successful studio but it's not all about animation.

 

[KNWVIKING]

***Echostar seems to be the leading target for such a defense, with a market cap of about $18 billion (meaning it would cost Disney about $18 billion give or take a few billion to acquire them, raising the pricetag for Disney to $85 billion or so - much too large for Comcast to swallow.)***

My understanding was that Echostar was more an FCC type manuever rather then a $$$ issue. Cable Co. owning a satelite provider service would excede even their monopoly capibilities.

 

[DisneyKidds]

The FCC thing seems to be icing on the potential cake. Echostar does a few things. It addresses the issue raised by the Comcast offer in that it would bring distribution in with the existing Disney content. Echostar also happens to be the right size............not too big, not too small. The FCC thing throws in a wrinkle as well, but it probably doesn't create many more FCC issues than Comcast/Disney would face. At least most of the analysis I've read on Echostar places the emphasis on the size and fit, and not primarily an FCC defense.

 

[KNWVIKING]

Of course Echo may just be a smoke screen to delay or force Comcast to up the ante. The Disney board rejected the take over offer, but sure left the door open for a better offer.

 

[crusader]

Echostar is interesting - and very closely held. Satellite ventures represent the future in direct distribution which is where Disney needs to start moving.

I liked this article. It sums up the industry hosts pretty well.

http://www.denverpost.com/Stories/0,1413,36~33~1955989,00.html