Comcast In $66bn Hostile Bid For Disney

12 February 2004

America's largest cable operator Comcast Corporation swooped late Wednesday on the Walt Disney Company with a hostile all-stock bid which values the US media group at $66 billion (€51.51bn; £34.90bn).

According to Comcast ceo Brian Roberts, he discussed the bid Monday with Disney's beleaguered ceo Michael Eisner, only to receive the thumbs-down.

This, said Roberts, left Comcast with no option but to launch a hostile tender for the company. "We think we're ready for the logical next step and that of course is entertainment and content," he explained.

Disney recently dismantled its "poison pill" defences and is seen by Wall Street observers to be in a weak position to oppose a formal offer from Comcast.

Dissident shareholders and ex-members of the Disney board Roy E Disney and Stanley Gold could not resist the opportunity to take a swipe at Eisner, their bete noir, claiming the bid demonstrates that Eisner's managerial failures had "made Disney an attractive target".

Meantime, although it may now be a largely academic consideration ...

Disney's board refuted accusations about its corporate governance, claiming it is putting together a succession plan for when Eisner steps down.

George Mitchell, a Disney director and former senator, this week wrote to two institutional investors, informing them that the media mammoth's board met in January to discuss the matter, both with and without Eisner present. Although directors have discussed this topic before, Mitchell said the talks were now "more formal and frequent, and extremely detailed".

The lack of a succession plan has been one of the criticisms levelled at the company by Roy Disney -- nephew of Walt -- and Stanley Gold, both of whom quit the board late last year to orchestrate a campaign against Eisner [WAMN: 15-Dec-03].

Earlier this week, the media group set out to counter the rebels' accusations, arguing that their claims were "misleading and distorted". Disney and Gold responded by insisting that the board "continues to resist independent, thoughtful consideration of opinions raised in opposition to Michael Eisner."

Mitchell himself has come under fire from the dissident duo, who last month claimed he "serves on far too many other boards to permit him adequate time for his Disney commitments."

Not so, claims Mitchell. "During my nine years on the board I have never missed a meeting; more importantly I prepared for and participated actively in the meetings," he declared, before firing a parting shot: "By contrast, while I attended every meeting over this nine-year period, neither Mr. Disney nor Mr. Gold did so."

Data sourced from: Financial Times and The Wall Street Journal Online; additional content by WARC staff