Bob Iger Prepares to Extend as Disney CEO if Fox Deal Happens, but Comcast Still a Contender

Bob Iger is likely to extend his tenure as Disney chairman-CEO if the company succeeds in acquiring 20th Century Fox and other big assets from the Murdoch empire.

Iger’s current contract runs through June 2019. He’s extended twice after originally setting his retirement date from Disney as 2015 as the Disney board has struggled to find a candidate to take the reins of the world’s largest media company. If Disney were to pull off a huge acquisition of film and TV assets from 21st Century Fox, it’s virtually a given that Iger would have to stick around to help oversee the hardest part of any merger deal — the integration of operations and management.

The Wall Street Journal was the first to report Iger’s plan to stick around if the Fox deal transpires, citing sources with knowledge of the situation. Iger’s most recent extension came in March, when he added one year to a contract that had been set to expire in mid-2018.

Disney reps did not immediately respond to a request for comment.

Disney is in talks with 21st Century Fox to acquire major portions of its entertainment assets, including the 2oth Century Fox film and TV studio, the FX Networks and National Geographic Channels cable groups, the regional Fox Sports cablers as well as Fox’s 39% interest in Euro satcaster Sky and a collection of international channels including the prosperous Star India outlet. Disney would also buy out Fox’s 30% interest in Hulu — a move seen as a first step toward turning Hulu into the foundation of the standalone streaming service that Disney has vowed to launch in 2019.

The deal under consideration is believed to be an all-stock transaction that values the Fox assets at around $60 billion.

There’s also speculation that a Fox acquisition could help Disney with its CEO succession problem. Twenty-First Century Fox CEO James Murdoch and 21st Century Fox president Peter Rice are seen as candidates for possibly serving an apprenticeship under Iger with an eye toward eventually taking the reins.

Disney’s talks with Fox picked up steam during the Thanksgiving holiday break and have continued ever since. Comcast also remains in the mix although the momentum is stronger with Disney, in part because the Murdochs are believed to see Disney as a better fit overall for the assets in question.

Sources said it seems unlikely that the pursuit of Fox will erupt into an all-out bidding war given Disney’s determination and deep pockets. There’s also the perception that Comcast would have a harder time than Disney guiding an acquisition through the regulatory approval process at a time when the Justice Department has signaled its willingness to challenge media consolidation through its efforts to block the AT&T-Time Warner merger.

Comcast’s hefty footprint as a cable operator and broadband provider is a dimension that Disney, for all its size, does not have. Bringing Fox content and programming assets into the Comcast tent could be a non-starter for the current anti-trust regime at the Justice Department.

The size of the deal and the presence of two industry giants in Disney and Comcast is believed to have discouraged other potential suitors, including Sony Pictures Entertainment and Verizon, from jumping into the fray. At present the talks are said to be happening at the highest levels rather than in an auction-style process with formal bid deadlines — at least for now.

Wall Street is closely eyeing the Disney-Fox courtship as a sign of a fundamental shift in the entertainment sector. If the Murdochs are willing to sell big portions of the conglomerate that Rupert Murdoch built up during the past half-century then the business horizon is surely changing for other players. But investors seem to be in wait-and-see mode as Fox and Disney shares have been relatively flat the past few days. Fox shares were up just 22 cents to $32.70 at the close of trading Wednesday, while Disney stock slid 1.6% to $105.46

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