The Department of Justice approved the Walt Disney Company’s $71 billion bid for the entertainment assets of 21st Century Fox on Wednesday, potentially complicating Comcast’s desire to make a rival offer for Rupert Murdoch’s entertainment empire.
The government’s approval was filed in federal court on the condition that Disney, which already owns ESPN, divest all of Fox’s 22 regional sports networks, which include valuable channels like the Yankees’ YES network.
“Today’s settlement will ensure that sports programming competition is preserved in the local markets where Disney and Fox compete for cable and satellite distribution,” Makan Delrahim, the head the Justice Department’s antitrust division, said in a statement.
In December, Disney and Fox agreed to an all-stock deal worth $52.4 billion. Then, two weeks ago, Comcast made an offer for the Fox assets worth about $65 billion. That prompted Disney to come back with its richer offer, which is a mix of cash and stock.
At stake are cable channels including FX and National Geographic, the “Avatar” and “X-Men” film franchises, and a pair of international television networks. Not included in the sale are Fox News, the Fox broadcasting stations and the FS1 sports network.
The regional sports networks are one of Fox’s most valuable businesses and are expected to generate more than $2 billion in profit this year.
