Walt Disney to buy 21st Century Fox assets in $52.4bn deal, including Sky stake

Under the terms of the agreement, 21st Century Fox shareholders will receive 0.2745 Disney shares for each of their shares. In addition, Disney will assume around $13.7bn of 21st Century Fox net debt.

The transaction includes 21st Century's film and television studios, cable entertainment networks and international TV businesses, inlcuding Sky in the UK and Star in India.

Disney chairman and chief executive Bob Iger said: "The acquisition of this stellar collection of businesses from 21st Century Fox reflects the increasing consumer demand for a rich diversity of entertainment experiences that are more compelling, accessible and convenient than ever before.

"We’re honoured and grateful that Rupert Murdoch has entrusted us with the future of businesses he spent a lifetime building, and we’re excited about this extraordinary opportunity to significantly increase our portfolio of well-loved franchises and branded content to greatly enhance our growing direct-to-consumer offerings. The deal will also substantially expand our international reach, allowing us to offer world-class storytelling and innovative distribution platforms to more consumers in key markets around the world.”

The deal is expected to yield at least $2bn in cost savings from efficiencies realised through the combination of the businesses, and to be accretive to earnings before the impact of purchase accounting for the second fiscal year after the close of the transaction.

Iger has agreed to stay on as chairman and chief executive officer of The Walt Disney Company through the end of calendar year 2021 in order to oversee the integration of the businesses.

Fox, which is awaiting a deep regulatory probe of its offer to buy the 61% of Sky that it does not already own, has agreed with Disney that it will seek to complete the planned acquisition.

"21st Century Fox remains fully committed to completing the current Sky offer and anticipates that, subject to the necessary regulatory consents, the transaction will close by June 30, 2018."

Sky, which with Fox remains bound by the offer agreement and by the rules of the UK takeover code and the requirements of the Takeover Panel, noted that Fox's current offer "is not conditional on the completion of the Disney transaction".

The UK takeover panel confirmed on Thursday that the announcement by Disney does not alter 21st Century Fox's obligations under the code with respect to its existing pre-conditional offer for Sky.

Fox boss Rupert Murdoch, whose family will end up with a 5% stake in Disney, told investors: “I know a lot of you are wondering, why did the Murdochs come to such a momentous decision? Are we retreating? Absolutely not. We are pivoting at a pivotal moment.”