Would Apple go after Disney before the ink dries on the Fox deal?

Would Apple go after Disney before the ink dries on the Fox deal?
Disney is a huge entertainment company that is getting bigger after this week's agreement to buy 21st Century Fox for almost $53 billion. Disney itself has often been mentioned as being in play. But with a market cap above $168 billion, not too many firms could afford to make a bid. But there is one tech giant who could not only buy the House of Mouse, it also would be a good fit. And in fact, the estate of this tech firm's co-founder is the largest owner of Disney shares. If you haven't figured it out yet, we are talking about Apple.

Earlier this year, we passed along the thoughts of RBC Capital Markets analyst Amit Daryanani who wrote to clients last April about the positives that could come from such a transaction. Daryanani was quick to say that such a deal is highly unlikely. Today, more than six months later, Forbes looked at the possibility of  an Apple acquisition of Disney. Large flashy transactions have not been Apple's style and the largest transaction it ever made was the $3 billion pick up of Beats Audio. Compare that figure to Disney's current market value of $168 billion. Add on a 30% premium and you're talking about spending almost $220 billion. That is a ton of money, not that Apple can't afford it.

Purchasing Disney would make Apple a huge media player and would allow the company to take advantage of Disney's plan to create its own streaming video app using its iconic characters and stories. Already, Disney said that it would stop giving Netflix access to its first run theatrical releases starting in 2019. 

When Apple co-founder Steve Jobs helped to fund Pixar, he became a major stockholder of the computer graphics company. Those shares were converted into Disney stock when the latter purchased Pixar. And the Steven P. Jobs Trust remains to this day, the largest stockholder in Disney. Assuming that Jobs' widow, who runs the Trust, is happy with any proposed deal, Apple could count on a large block of Disney to vote in favor of such a transaction.

Would Apple be getting its monies worth? A number of Wall Street analysts say that such a deal would add to Apple's earnings, and owning the Disney name would enhance Apple's own standing as an iconic global company. The value of Disney is also found in its library of films and television shows, which is an asset that Apple is a position to distribute through various technologies. And Apple would be able to promote its brand in the two U.S. parks located on each coast.

If Apple has any thoughts toward making a play for Disney, it needs to do so with a sense of urgency. Once the deal for 21st Century Fox closes in as soon as a year, any purchase of Disney becomes more complicated and harder to accomplish.

Nothing has really improved the odds of an Apple acquisition of Disney taking place since the last time we addressed this. But as time goes on, it becomes more important for Apple to consider becoming a huge player in content. After all, it is content that drives hardware sales, which is where Apple currently lives.

source: Forbes

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32 Comments

1. gigicoaste

Posts: 446; Member since: Feb 21, 2016

If and maybe and what if ... yet another Bloomberg speculativ "article" .. "good job" PA.

2. mikehunta727 unregistered

Source is Forbes

3. Finalflash

Posts: 4063; Member since: Jul 23, 2013

Doesn't matter, Apple can't afford Disney it's a stupid article. Even with buckets of cash no company is about to drop 200 billion on anything and specially Apple who still charge for dongles.

6. mikehunta727 unregistered

Whether it matters or not is irrelevant I was just stating the source.. in which it wasn't Bloomberg but Forbes. Yeah I know Apple cant come close to buying Disney

11. Zylam

Posts: 1813; Member since: Oct 20, 2010

Oh so you've seen Apple's books and know exactly what they can or cannot buy?

18. mikehunta727 unregistered

Apple doesn't have near 200+ billion to spend Zylam. No one is buying Disney

20. darkkjedii

Posts: 30964; Member since: Feb 05, 2011

Careful, he's the ultimate floor wiper.

22. Zylam

Posts: 1813; Member since: Oct 20, 2010

Accusations of such massive nature are not done on pure cash reserves . Apples market valuation is above 800 Billion. An accusation of such level would probably be done by a transfer of Apple shares to the board members with a 20% premium of 20-30 million paid out in cash to each board member as an incentive for the deal. Apple is not dumb, they wouldn't blow their own cash reserves to buy another company. The reason why companies go public is to save their reserves and get traders to invest their volatile assets to grow the company valuation. And in return they get a slice of the profits pie. People here clearly have zero idea how companies are run, it's just because it's Apple. As long as Apple and it's users are insulted, all false facts and statements are perfectly fine Why do I even bother. It's alrite. Death to Apple.

26. mikehunta727 unregistered

No one is saying death to Apple here dude lmao I have stuck up for Apple many times before in basis of factual truth, but Apple would have to fork over at least $150 billion at first and than some, that would decimate pretty much all the profits they made in the past decade, it's fun to speculate, and Apple, out of most companies are the closest to theoretically buying Disney out but I just' dont think it will ever happen, Disney is too big Relax'

28. Zylam

Posts: 1813; Member since: Oct 20, 2010

Wow you understood literally nothing at all. I'm really not even going to bother. Yea sure buddy whatever you say is 100% valid.

30. mikehunta727 unregistered

Lol okay tell yourself that whatever floats your boat

23. Venom

Posts: 3401; Member since: Dec 14, 2017

I assume you have read their books and accounting records?

27. mikehunta727 unregistered

No but I know that forking over 200 billion would decimate their profits and their whole cash reserve entirely or nearly entirely that they made in the past decade, just see their quarter by quarter/YoY on profit returns

4. gigicoaste

Posts: 446; Member since: Feb 21, 2016

is that a reason for another financial article on a tech site? Maybe for you.. yes, not for me.

5. snowgator

Posts: 3621; Member since: Jan 19, 2011

Pure fantasy.

7. darkkjedii

Posts: 30964; Member since: Feb 05, 2011

Disney is buying up everything. Hell, they may buy Apple.

14. dimas

Posts: 3343; Member since: Jul 22, 2014

Happy holidays to you and your family dark. I don't always check phonearena anymore so I'll just reply to your comment. Enjoy using your iphone x and note 8.

19. darkkjedii

Posts: 30964; Member since: Feb 05, 2011

Happy holidays to you and yours as well bro.

15. dimas

Posts: 3343; Member since: Jul 22, 2014

Agree. Disney can adapt their business through times and it is proven for years. Just make iphone flop and apple will be in shambles.

8. theot14430 unregistered

I hope Disney, Comcast, and Verizon goes down in flames, and rots in Hell.

13. dimas

Posts: 3343; Member since: Jul 22, 2014

Tell that to their thousand + employees that will lose job if they follow your brain pattern.

17. Zylam

Posts: 1813; Member since: Oct 20, 2010

I can understand Verizon and Comcast, but why do you have a problem with Disney?

24. Windsponge

Posts: 97; Member since: Nov 01, 2009

Wow why don’t you just quit watching tv.... get rid of your phone... become a monk and they just might...

10. Dr.Phil

Posts: 2340; Member since: Feb 14, 2011

The author of the source article does conclude that Apple would more than likely buy up a smaller media company than one as large as Disney. I would actually reason to bet that if the Time Warner deal with AT&T falls through that it would be them or possibly Netflix. Netflix would probably make the most sense considering it’s used on every platform and has the ability to grow even more.

12. dimas

Posts: 3343; Member since: Jul 22, 2014

And Apple-owned Disney will release a $1000 mickey mouse doll.

16. Zylam

Posts: 1813; Member since: Oct 20, 2010

Makes a lot of sense, after the whole hardware thing stabilizes, which for the most part has already happened, all the large corporations know the big money lies in subscription services. And for that you need content. Not sure it would be a good thing, I hate iTunes being so locked down and you have to use an Apple TV.. Yuck. I prefer to buy my movies on the Play store because they get added to your Youtube account, and anything with a screen and Wifi these days usually has a Youtube app. It's probably better for Disney to remain neutral and push its content on all platforms so long as it gets that monthly subscription fee. That way no one gets to dictate what hardware you need to own.

29. DnB925Art

Posts: 1167; Member since: May 23, 2013

Actually with Movies Anywhere (most) movies you buy from iTunes also get added to Google Play and YouTube (as well as Vudu and Amazon). I believe Disney is one of the studios that transfers to Movies Anywhere. AFAIK only Paramount and Lionsgate movies are not part of Movies Anywhere.

21. makatijules

Posts: 835; Member since: Dec 11, 2017

Disney will never sell itself to anyone, because Disney would need to be the parent company always. Walter Alias Disney I am sure has designed the company to never be bought by anyone.

25. RebelwithoutaClue unregistered

Being the largest single stakeholder doesn't mean a thing when it's under 5% of all shares. And with the deal just made with Fox, the Murdochs are getting about 5% of the shares as well. So they are not even close to getting enough shares to buy Disney and I am sure Disney won't sell to Apple.

31. RoboticEngi

Posts: 1251; Member since: Dec 03, 2014

Omfg this company is going to ruin the world...

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