In a memo to employees, Disney CEO Bob Iger boasted that the deal to buy a majority of 21st Century Fox assets from the Murdoch family would be an “historic” one.
In the memo, Iger underlined the deal’s ability to improve Disney’s competitiveness in today’s rapidly shifting market.
The shift from traditional broadcasting to streaming via the Internet is already upending the business models of several big companies in the entertainment space, and Disney is feeling the pinch of that shift.
The acquisition of key assets from Fox will allow the iconic entertainment juggernaut to complement its suite of production houses and traditional TV channels with Fox’s film and TV studio, as well as the seller’s stake in BSkyB, a broadcaster.
As Disney prepares to take on the future by launching two major streaming services over the next two years, the acquisition will help bolster not only its content creation capabilities but also its technology chops.
The deal is expected to take up to 18 months to finalize, after which the sale, if approved by all parties concerned, will take place for a currently estimated $52.4 billion, potentially making it the 13th largest acquisition of the 2010s.
To put that in perspective, the amount is close to double what Microsoft paid to acquire LinkedIn last year.
The Murdochs – father Rupert and sons Lachlan and James – sent a different memo to their own employees reassuring them of support during what will inevitably be an upsetting transition.
While trying to assuage their fears about the impending changes, the trio also hinted that layoffs are on the cards.
Both Disney’s and Fox’s memos are published in full on Variety.com.
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