James Murdoch could be next Disney CEO if US$60 billion merger with Fox goes through
The Fox boss James Murdoch is reportedly being considered as a potential successor to Bob Iger, chief executive of Walt Disney, if the two companies reach agreement on a possible takeover.
According to the Financial Times, Rupert Murdoch and his younger son, James, could take senior roles at a combined company if a deal is struck. Iger, 66, is due to retire in 2019 and James Murdoch, 44, currently chief executive of 21st Century Fox and chairman of the satellite broadcaster Sky, is a possible successor.
But Disney is not Fox’s only suitor. Comcast, the US’s largest cable operator and owner of NBC Universal, the TV network and movie studio company, is also reported to be assessing a bid, as is Verizon, the largest US telecoms group.
Neither company was immediately available for comment. “No promises have been made,” one person briefed on the talks told the FT.
Any such deal is likely to run into trouble with shareholders who have consistently criticised the Murdochs over corporate governance. The takeover comes as their stewardship is under question following a series of sexual harassment charges at Fox. Those allegations have triggered an official inquiry by the Competition and Markets Authority in the UK into plans to buy the rest of Sky.
The possible Fox sale comes in as the media landscape is being reshaped by the entry of new players including Apple, Amazon and Netflix. Pressure on cable subscriptions and competition for assets has set off a wave of mega-deals.
AT&T is in the midst of an US$85.4bn takeover of Time Warner, but that deal is now struggling. The US justice department sued to block the deal last month, arguing that a takeover would “substantially lessen competition, resulting in higher prices and less innovation for millions of Americans”.
That deal is now heading to court, with AT&T suggesting the justice department stepped in because of Donald Trump’s open antipathy to the “fake news” he claims is being generated by Time Warner’s CNN.
Comcast, too, was heavily criticised by US officials during its ultimately successful bid for NBC Universal in 2009, and regulators appear concerned about media mergers that combine content – films and TV – with delivery – cable and satellite.
According to the FT, the Murdochs favour a deal with Disney, as they believe it poses the lowest regulatory risk. Competition from the tech giants may have strengthened arguments for the merger of content companies.
According to CNBC, which first broke the news of the discussions, Disney and Fox are now close to making an agreement and an announcement could come as early as next week.
The sale of the Murdochs’ prime media assets would leave them with control of News Corp, which owns a portfolio of newspapers around the world – including The Times and The Sun in Britain, and The Wall Street Journal in the US.
