A key reason why I wrote yesterday that a Disney (DIS) sale would not be announced until the end of 2024 or in 2025 is that Disney has to be thinking about the Biden Administration’s FTC head Lina Khan blocking a potential deal, whether it be for pieces of Disney such as ABC, or for the Content business (studio, content library, etc.) plus the Parks business. Working through a deal of this size with potential suitors would take a year-plus. During that period a new, more deal-friendly Administration may be ushered into the White House. In terms of potential Disney acquirers:
Amazon (AMZN): My view is that Amazon would absolutely want Disney’s content business (it would probably spin-off the Parks business in my view). Amazon’s MGM acquisition was only a warm-up.
Apple (AAPL): Apple should want to buy Disney, but CEO Tim Cook does not strike me as a creative thinker and lacks urgency. Apple needs to develop its M&A muscle.
- Apple should have acquired Disney years ago once it decided to play in the content game.
- Apple will require content for Apple TV as well as its VisionPro headset. With Disney under Apple’s umbrella, Apple could exercise more influence over Disney in terms of creating VR content for the VisionPro platform derived from Disney’s content IP.
- Disney’s brand is congruent with Apple’s self-image.
- Further, Disney’s content is global, which plays into Apple’s strategy. I am not sure whether Apple would wish to keep the Parks business.
Google (GOOGL): YouTube has proved to be more aggressive on the content acquisition side under its new CEO as exemplified by its NFL Sunday Ticket deal ($14 billion price tag). I believe Google would spin-off the Parks business.
Microsoft (MSFT): Microsoft just completed its Activision deal, the largest Tech acquisition in history. Disney’s content would fit nicely into MSFT’s Xbox platform.
Netflix (NFLX): This would be a merger of almost equals. Disney’s content IP would fit nicely into Netflix’s existing business. I believe that the current FTC leadership would crack down harder on this type of a “horizontal” deal than it would on a deal with one of the other four companies.