Disney gets shareholder OK to acquire Fox movie and TV studios, and stake in Hulu

Corrections & Clarifications: An earlier version of this story misstated the value of the deal.

The Mouse House has officially added a new addition.

Shareholders at Walt Disney and Twenty-First Century Fox have approved Disney's $71.3 billion acquisition of the Fox movie and TV studios and other assets including Fox's 30 percent stake in streaming service Hulu.

As a result of the shareholder votes, held simultaneously Friday in New York, Disney will evolve into a more dominant streaming video competitor and an even bigger box office behemoth: Disney and Fox have collectively accounted for more than 46 percent of the total box office so far this year.

Disney, which owns the Pixar, Lucasfilm and Marvel brands as well as its own live-action and animation studios, will now add to its portfolio the historic 20th Century Fox studio, which has produced such classics as "The Sound of Music," "Miracle on 34th Street," "Patton," "Alien," "Titanic," "Avatar" and the original "Star Wars" film.

More: Marvel movie wish list! What we want to see out of the Disney/Fox merger

Disney won out over Comcast in a bidding war for the assets, which will leave 21st Century Fox as a streamlined media company focused on news and sports. In June, Comcast submitted a $65 billion all-cash offer to Fox, outbidding Disney's original $52.4 billion proposal from December 2017.

But a week later, Disney countered with its own higher bid of $71.3 billion of cash and stock, which the Fox board approved citing a lower risk of regulatory hurdles.

The Justice Department has approved the deal and other international regulatory approvals should be forthcoming, provided there's no unforeseen pushback.

Disney CEO Bob Iger thanked Fox Executive Chairman Rupert Murdoch, whose family controls Fox, for "entrusting us with the future of these extraordinary businesses," he said in a statement. "(We) look forward to welcoming 21st Century Fox’s stellar talent to Disney and ultimately integrating our businesses to provide consumers around the world with more appealing content and entertainment options.”

With Disney winning out in this battle of media giants, it's worth taking a look at how the company that Walt built will be transformed.

What exactly is Disney getting?

In addition to the Fox movie studio, Disney will gain the Fox Searchlight studio, which produced 2018 Best Picture winner "The Shape of Water" and "Three Billboards Outside Ebbing, Missouri." The latter movie won a best actress Oscar for Frances McDormand and a best-supporting actor Oscar for Sam Rockwell.

Disney also gets Fox's 30 percent stake in streaming service Hulu, which makes Disney the majority stakeholder. Hulu, which originally had been owned by ABC (Disney), NBC (Comcast) and Fox — each holding 30% stakes — and Time Warner (10%). Comcast got NBCUniversal's share in its acquisition of the network-studio giant which closed five years ago.

The other Fox assets include Mumbai-headquartered media company Star India and a 39 percent stake in U.K.-based pay-TV and broadband provider Sky.

To obtain approval of the Justice Department, Disney must also divest Fox's 22 regional sports networks it acquires in the deal.

What is Fox keeping?

Fox will keep the Fox network, Fox News Channel and Fox Business Network, as well as sports networks FS1, FS2 and Big Ten Network, and its 28 local TV stations. The media company has said it plans to launch a Fox Nation subscription streaming service in the fourth quarter.



What changes to expect?

The companies expect to complete the merger in the first half of 2019. Any new films under the larger Disney umbrella will still get released in theaters before they hit streaming platforms.

"Disney has been pretty clear that they want to maintain the theatrical window for their big movies so it probably means consumers are unlikely to see any near-term closing of the theatrical window," said Rich Greenfield, a media and technology analyst with financial services firm BTIG in New York.

Since Disney now has more TV channels, it could negotiate with pay TV providers to carry more of its offerings. That could mean "even more bloated bundles," Greenfield said.

What also remains to play out is what happens to Sky. Disney would own Fox's current 39 percent in the TV and broadband provider. Fox increased its bid earlier this month to $32.5 billion, effectively serving as a proxy for Disney in topping Comcast’s earlier $31 billion bid.

Wall Street experts expect Comcast to increase its bid because CEO Brian Roberts said, in dropping out of the bidding for Fox, that the company would focus on acquiring the larger portion of Sky to propel its international growth.

Fox and Disney could let Comcast win the 61 percent of Sky currently up for bid and once the deal is done, hold onto it, sell its share to another bidder or sell it to Comcast, perhaps in a deal that would also send Comcast's 30 percent of Hulu to Disney.

"The ball comes back to Disney as to how this unfolds," said Tuna Amobi, CFRA Research director and senior equity analyst. "I don't think Disney wants to get into a protracted bidding war (for Sky) now that it has gotten Fox."

What is the timetable for Disney to deploy its new franchises in theaters?

Everything’s not going to change overnight and the X-Men aren’t going to just show up in next year’s “Avengers 4” (though an end-credits tease could be a possibility). Disney and Marvel haven’t been specific about any movies coming past "Spider-Man: Far From Home," out July 5, 2019. More than likely, they’ve been waiting for the merger to be official before doing a bunch of announcements, like perhaps a new “Fantastic Four” reboot.

Disney’s own streaming service is scheduled to launch for in 2019 and, assumably, that will now include a lot of Fox’s content, both TV and movies. But the studios themselves are a big question mark: Fox and its prestige arm Fox Searchlight -- although Disney CEO Bob Iger said he was "quite impressed" with what the studio has accomplished -- may get folded under the Disney banner or stay separate as different brands.



What happens to movies currently in development at Fox?

Principal production is done on "Dark Phoenix" (slated for Feb. 14) and New Mutants (Aug. 2, 2019), but both X-Men films have been delayed already. Disney could go forward with them or yank them totally and start an all-mutant reboot sooner than later. Neither “Deadpool 3” nor “X-Force,” which would feature Ryan Reynolds’ fan-favorite masked mercenary, have been announced, though with the money the first two R-rated “Deadpool” movies made, it would make sense for Disney to keep those going somehow.

As far as Fox’s other franchises, director James Cameron has been working on two “Avatar” sequels (dated for 2020 and 2021) , and Mickey Mouse also has his hands now on “Die Hard,” “Alien” and “Planet of the Apes,” among other high-profile properties.

Will we likely see The Simpsons at Disney theme parks?

That could surely come to pass, but may take two to three years to happen. Walt Disney parks have already established an “Avatar” already has a presence in Disney theme parks so those will likely go off without a hitch.

Follow USA TODAY reporter Mike Snider on Twitter: @MikeSnider.