Disney’s bid for Fox assets gains momentum: sources

(Reuters) – Walt Disney Co (DIS.N) is in the lead to acquire much of Twenty-First Century Fox Inc’s (FOXA.O) media empire, though rival suitor Comcast Corp (CMCSA.O) remains in contention, people familiar with the matter said on Tuesday.

FILE PHOTO: The Twenty-First Century Fox Studios flag flies over the company building in Los Angeles, California U.S. November 6, 2017. REUTERS/Lucy Nicholson /File Photo

The Murdoch family, which controls Fox, prefers a deal with Disney because it would rather be paid in Disney than Comcast stock, and expects a potential deal with Disney to be cleared by U.S. antitrust regulators more easily, one of the sources said.

However, no deal between Disney and Fox is imminent and several issues have yet to be fully negotiated, the sources said.

CNBC had reported earlier on Tuesday that a deal for Disney to buy Fox’s movie studio and television production assets for more than $60 billion could come as early as next week.

Fox shares rose 1.6 percent in midday trade, while Disney tumbled 3 percent. Comcast shares were down 0.9 percent.

FILE PHOTO: The logo of the Disney store on the Champs Elysee is seen in Paris, France, March 3, 2016. REUTERS/Jacky Naegelen/File Photo

Disney would acquire Fox’s FX and National Geographic cable channels, its movie studio, the Star network in India and stakes in European pay-TV provider Sky PLC (SKYB.L). Fox would keep its news and business news divisions, its broadcast stations and Fox Sports, the sources said.

Reuters reported in November that Comcast, the largest U.S. cable provider, had expressed interest in Fox assets.

Those assets would offer the opportunity for both Comcast and Disney to broaden their international distribution footprint.

They would also be a source of new content at a time when companies like Amazon.com Inc (AMZN.O) and Netflix Inc (NFLX.O) are spending billions to bulk up on programing. Comcast has steadily boosted its ownership of content over the years.

The Reuters sources asked not to be identified because the negotiations are confidential. Fox declined to comment, while Disney and Comcast did not immediately respond to requests for comment.

Any potential deal would follow the U.S. Department of Justice’s decision to sue to block AT&T Inc’s (T.N) $85.4 billion deal to buy Time Warner Inc (TWX.N).

Reporting by Greg Roumeliotis and Jessica Toonkel in New York; Additional reporting by Laharee Chatterjee and Munsif Vengattil in Bengaluru and Anjali…

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