21st Century Fox ‘restarts talks’ for possible sale to Walt Disney

21st Century Fox ‘restarts talks’ for possible sale to Walt Disney

The Rupert Murdoch-controlled 21st Century Fox has restarted talks to sell most of the company, including UK broadcaster Sky, to Walt Disney, it was reported on Sunday.

The negotiations centre on Fox’s film studio, cable channels such as FX, and international businesses including India’s Star network and Sky, the Financial Times reported, citing “multiple people with knowledge of the talks”.

The apparent talks come as Fox struggles to secure full control of Sky for the second time in a decade. The £11.7bn ($15.41bn) deal has run foul of regulator concerns about media plurality in the UK and the Murdochs’ commitment to broadcasting standards.

The UK’s Competition and Markets Authority (CMA) is scrutinising the deal after a referral by Karen Bradley, the culture secretary, in September.

That followed a review by Ofcom, the UK media watchdog, raised “significant concerns” over the two options for solving media plurality issues, known as behavioural and structural remedies. The CMA is due to publish the provisional findings of its investigation in December. Sky has threatened to close its Sky News network if the deal is not cleared.

In what was viewed as a setback for the Murdoch family’s hopes of taking full control of Sky, last month Ofcom ruled that the Fox News programmes Hannity and Tucker Carlson Tonight breached impartiality rules covering British broadcasting.

A deal with Disney would end Fox’s pursuit of Sky and leave it with the Fox News Channel, Fox broadcast network and its sports rights, which the FT reported would not be sold.

Talks between Fox and Disney were first revealed early last month, when US news channel CNBC said Fox managers believed the company could not gain the size needed to compete with Amazon, Netflix and other major competitors. It said talks had come to a halt.

Traditional media players are increasingly having to compete for viewers with Amazon, Apple, Google, Netflix and other tech firms that are funding their own content and tapping into the trend towards accessing entertainment via the internet rather than a TV or DVD player.

A Disney takeover of Fox’s entertainment assets would create a Hollywood powerhouse. Fox’s recent hits have included the Planet of the Apes and X-Men film franchises, while Disney controls Pixar and the Star Wars series.

But cable subscriptions, an area where both Fox and Disney have made fortunes, are slipping as more people rely on the internet to deliver their entertainment.

Disney is thought to be unlikely to seek to buy Fox’s sports programming assets for fear of running foul of antitrust laws given its ownership of the ESPN sports network, and would also not buy Fox News or Fox’s local broadcasting affiliates.

It might face competition for Fox’s entertainment assets from Comcast, the US cable group, and Verizon, the telecoms group, both of which have expressed an interest.

Fox and Disney had yet to respond to a request for comment by the time of going to press.

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