Blackstone, one of the world's largest private equity firms, has initiated talks with Walt Disney to assess the potential acquisition of Disney's media operations in India, including its streaming and television businesses, as reported by ET.
In recent weeks, high-level leadership from both companies have engaged in several discussions. Blackstone is considering the purchase of either a partial business package, which includes assets like sports properties, media rights, and the Disney+ Hotstar streaming service, or the complete portfolio, encompassing the flagship Star India TV network, over-the-top (OTT) services, and a 30% stake in Tata Play (formerly Tata Sky), according to an ET report.
Key players in facilitating these discussions are believed to be Kevin Mayer and Tom Staggs, former Disney executives who were brought back as advisors to CEO Bob Iger in July. Staggs, a former Disney CFO, held various roles within the organisation, including chief operating officer and head of theme parks. Mayer, once seen as Iger's potential successor, was a driving force behind Disney's streaming strategy and worked closely with the CEO on several acquisitions. Both have been running Candle, a media group supported by Blackstone.
Another factor that might influence a potential deal between Disney and Blackstone is Vanguard, the world's second-largest asset manager after BlackRock and the largest shareholder in both companies.
It remains unclear whether Blackstone is considering a broader global transaction or focusing solely on India. Globally, Disney has faced financial challenges, including suboptimal revenue, substantial debt, a struggling TV business, underperforming movies, labour disputes with Hollywood writers, shareholder activism, significant layoffs, a declining share price, and a major dispute with the state of Florida upon the reopening of its theme parks after a two-year COVID-related hiatus.
Iger has been actively working to reduce costs by $5.5 billion, aiming to restructure the company and prioritise creativity in three key areas: film studios, theme parks, and streaming. Simultaneously, he's exploring "strategic options" for Disney's legacy TV networks, such as ABC. Additionally, Iger has already arranged a $1.5 billion cash deal with Penn Entertainment for ESPN and is in negotiations with Comcast regarding the acquisition of the remaining 33% stake in Hulu, scheduled between September and January 2024.
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