27 June 2018•Update: 27 June 2018
By Ovunc Kutlu
NEW YORK
The Justice Department conditionally approved Wednesday The Walt Disney Company's proposed acquisition of 21st Century Fox, according to an antitrust lawsuit filed in the U.S. District Court for the Southern District of New York.
The agency said in a statement that it requires Disney to divest 22 regional sports networks Fox has in order to complete the deal.
Disney sweetened its proposal for Fox last week by offering $71.3 billion, after Comcast offered $65 billion in the previous week.
“American consumers have benefitted from head-to-head competition between Disney and Fox’s cable sports programming that ultimately has prevented cable television subscription prices from rising even higher,” Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division said in the statement.
It added that without the divestitures, Disney's acquisition of Fox would likely result in higher prices for cable sports programming.
At stake are Fox's YES Network which broadcasts New York Yankees baseball games and Brooklyn Nets basketball. Fox regional networks broadcast about 100 American professional teams.
If Disney accepts the offer and the deal is finalized, 21st Century Fox's remaining assets such as Fox News and Fox Sports, will be spun off to a new entity named New Fox.
After the announcement, Disney shares lost some of their gains but were up 0.7 percent for the day at 1.30 p.m. EST (1530GMT). Fox shares were up 1.7 percent.
