Comcast blinks in fight with Disney for Twenty-First Century Fox

Comcast blinks in fight with Disney for Twenty-First Century Fox

Comcast has been expected to drop out of the acquisition after Disney increased their bid and received approval for the deal by the Department of Justice. The announcement Thursday leaves the path open for The Walt Disney Co.to buy the Twenty-First Century Fox assets with its $71 billion offer.

Under the deal that Fox has with Disney, Murdoch must gain consent to raise his bid.

Comcast can now focus on its pursuit of European pay-TV operator Sky, a deal that would give the Philadelphia-based cable and media company a larger presence outside the U.S. Of course, some of the franchises that will be of interest to comic book fans are X-Men, Fantastic Four, Deadpool, and Avatar, which will now fall under the Disney banner.

The deal would help Disney further control TV shows and movies from start to finish - from creating the programs to distributing them though television channels, movie theaters, streaming services and other ways people watch entertainment.

Buying Sky would make Comcast the world's biggest pay TV network and would reduce its dependence on the United States market. A Comcast-Fox merger, like a Disney-Fox merger, would have been similarly vertical by combining a distributor with a content producer.

For one of Fox's assets though, the battle has only just begun.

Sky's share price fell 2% following Comcast's news, indicating investor fears that Murdoch might not now return with an improved bid. Comcast has apparently decided the fight over Sky is more important than the fight over Fox, so the cable giant, that also owns NBC and Universal, will be looking to spend its money there. Even then it isn't going to be easy for Comcast.

But Brian Roberts and Comcast have been competing against Fox for the remaining 61 percent of Sky, driving up the value of the deal so far to $32 billion.

Still, Comcast dropping out of the 21st Century Fox bidding war means that Disney will obtain a treasure chest of valuable assets once the sale goes through. Can Comcast make them an offer that's just too insane to turn down? Rupert Murdoch founded its predecessor company in the 1980s and sold off a majority of the ownership to address debts.