21CF, Disney shareholders approve merger deal
MUMBAI: Twenty-First Century Fox and The Walt Disney Company have announced that, at separate special meetings today, stockholders of the two companies approved all proposals related to Disney’s acquisition of 21st Century Fox.
The proposals included the adoption by 21st Century Fox stockholders of the merger agreement with Disney and the distribution merger agreement for the spin-off of new Fox. Disney stockholders approved the issuance of new common stock that will be distributed to 21st Century Fox stockholders as part of the acquisition.
“Combining the 21CF businesses with Disney and establishing new ‘Fox’ will unlock significant value for our shareholders. We are grateful to our shareholders for approving this transaction. I want to thank all of our executives and colleagues for their enormous contributions in building 21st Century Fox over the past decades. With their help, we expect the enlarged Disney and new ‘Fox’ companies will be pre-eminent in the entertainment and media industries,” said 21st Century Fox executive chairman Rupert Murdoch.
“We’re incredibly pleased that shareholders of both companies have granted approval for us to move forward, and are confident in our ability to create significant long-term value through this acquisition of Fox’s premier assets,” said The Walt Disney Company chairman and CEO Robert A. Iger.
“We remain grateful to Rupert Murdoch and to the rest of the 21st Century Fox board for entrusting us with the future of these extraordinary businesses, and look forward to welcoming 21st Century Fox’s stellar talent to Disney and ultimately integrating our businesses to provide consumers around the world with more appealing content and entertainment options.”
Under the Disney Merger Agreement, 21st Century Fox stockholders may elect to receive $38 per share in either cash or shares of New Disney, a new holding company that will become the parent of both Disney and 21st Century Fox (the consideration may be subject to adjustment for certain tax liabilities).
The overall mix of consideration paid to 21st Century Fox stockholders will be approximately 50% cash and 50% stock. The stock consideration is subject to a collar, which will ensure that 21st Century Fox stockholders will receive consideration equal to $38 in value if the average Disney stock price at closing is between $93.53 and $114.32.
Disney expects to pay a total of about $35.7 billion in cash and issue approximately 343 million New Disney shares to 21st Century Fox stockholders. As a result, current 21st Century Fox stockholders will own a 17-20% stake in New Disney on a pro forma basis.
Last month, the U.S. Department of Justice entered into a consent decree with Disney and 21st Century Fox that allows the transaction to proceed, while requiring the sale of the Fox Sports Regional Networks. Completion of the transaction is subject to a number of non-U.S. merger and other regulatory reviews, and other customary closing conditions.
Combining with Disney are 21st Century Fox’s critically acclaimed film production businesses, including Twentieth Century Fox, Fox Searchlight Pictures and Fox 2000, Twentieth Century Fox Television, FX Productions and Fox21. Disney will also acquire FX Networks, National Geographic Partners, Fox Sports Regional Networks, Fox Networks Group International, Star India and Fox’s interests in Hulu, Sky plc, Tata Sky and Endemol Shine Group.