A deal that would have been unimaginable just a couple months ago has now been finalized: Walt Disney Company announced that it will acquire 21st Century Fox, including Twentieth Century Fox movie and TV studios, most of its cable networks, international assets like Star and Sky and its stake in Hulu for $52.4 billion. The deal will be an all-stock transaction.
To complete the integration, a legacy-defining task, Robert A. Iger, Disney’s chief executive, agreed to renew his contract for a fourth time, delaying retirement from July 2019 to the end of 2021.
The deal, officially valued at $66.1 billion including assumption of debt, will create an entertainment colossus that expands Disney’s footprint in every area. The agreement encompasses Fox’s prolific film and television studios, its FX and National Geographic cable networks, its regional sports networks, its 39 percent stake in U.K. satellite television provider Sky and its international cable networks, including Star India. It also includes one of the most coveted film libraries in the game—something that will be important as Disney pursues its ambitions to become a streaming media giant that challenges Netflix and forges direct relationships with consumers.
Disney is already a media and entertainment giant, with ABC, ESPN, Pixar, and the Marvel and Star Wars film franchises in its portfolio. Last year, Disney was the first studio to take in more than $7 billion at the box office globally, with films including Rogue One: A Star Wars Story, Captain America: Civil War, Finding Dory and live-action film The Jungle Book.
Streaming is a market Disney plans to break into in a big way. This year, the company announced two coming services: one, powered by sports programming from ESPN, set to begin next year and another, scheduled for 2019, to be built around movies and TV shows. Disney hopes the Fox television juggernaut can supercharge its ambitions by producing original series for the services and providing access to a catalog of older offerings. Fox would also contribute its stake in Hulu, the streaming service that shows ABC content and original programming like The Handmaid’s Tale, giving Disney a majority share.