When Disney and Fox announced their deal in December, the expectation was that it would take 12 to 18 months to close, though UBSs John Hodulik and other analysts wrote that they believed that the Disney-Fox deal could close before the end of the year.
Disneys ability to secure approval now, however, six months after announcing the merger, could be critical as it faces another potential Comcast offer. Fox must schedule a shareholder vote to move forward with a Disney bid.
I could see how Disney wanted to cut a deal quickly if delay meant increasing the prospects of a Comcast counter, Hal Singer, economist at George Washington Universitys Institute of Public Policy, wrote in an email.
In announcing the approval, the Justice Department noted that to streamline agency clearance, Disney agreed to divest the 22 RSNs rather than continue with the Antitrust Divisions ongoing merger investigation. In other words, it became clear to Disney what the Justice Departments major concern was with the deal: Disneys purchase of the RSNs would harm competition for sports programming in those local markets. Rather than try to challenge that contention or negotiate some kind of conditions, a process that could have taken many more months, Disney agreed to the type of structural remedy favored by the DOJ under antitrust chief Makan Delrahim.
