21st Century Fox announced a sweetened deal with Disney, which raised its price to more than $70 billion in cash and stock. That beat out Comcast’s bid of nearly $65 billion cash for the Fox assets and is nearly $20 billion higher than Disney’s original offer. The announcement was a surprise to investors who expected Fox’s board to go with Comcast’s offer and give Disney the opportunity to counter.
Still, it is more than likely that Comcast will come back with a higher bid in a matter of days.
While Disney’s offer is higher, some Fox shareholders such as big mutual funds may prefer Comcast’s all-cash offer over Disney’s stock and cash offer because the value of cash is certain. But an all-cash offer could pose tax problems for Fox shareholders—most obviously Rupert Murdoch and his family, which owns a 17% economic interest in Fox.