Fox feared Comcast came with more regulatory baggage than Disney

  • Fox saw Disney as a safer bet in part because of its mix of businesses, an SEC filing reveals.
  • Comcast could have posed a greater problem, considering the deal would give it a controlling stake in Hulu.
Rupert Murdoch
Drew Angerer | Bloomberg | Getty Images
Rupert Murdoch

Twenty-First Century Fox saw Disney as a safer regulatory bet than Comcast when deciding on competing bids, a filing with the Securities and Exchange Commission reveals.

The registration document, filed Monday, states that “while a potential Disney transaction was likely to receive required regulatory approvals and ultimately be consummated, a strategic transaction with Comcast continued to carry higher regulatory risk leading to the possibility of significant delay in the receipt of merger consideration as well as the risk of an inability to consummate the transactions.”

One reason Disney was less likely to face such regulatory scrutiny, the filing says, is because of its mix of businesses. Comcast, on the other hand, could have been seen as a greater threat to competition, partially due to the fact it would gain a controlling position in Hulu.

Disney’s $38 per share cash-and-stock bid, compared with Comcast’s $35 per share all-cash proposal, did not hurt, either, according to the filing.

Although the deal is expected to go through in the next six to 12 months, Disney is on the hook for $2.5 billion to Twenty-First Century Fox if the merger is derailed by antitrust regulation.

Disclosure: Comcast is the parent company of NBCUniversal and CNBC and is a co-owner of Hulu.