The $52.4-billion Disney-Fox mega merger represents one of the biggest deals in history and the Murdoch family of 21st Century Fox fame will be compensated nicely—and personally--when the deal goes through.
Rupert Murdoch and sons James and Lachlan will receive more than $206 million in ‘Golden Parachute’ compensation once the deal is finalized, according to Wednesday’s SEC filings.
For patriarch Rupert Murdoch, the golden parachute payout is $66.7 million, some $40 million of which is in cash, while the biggest take-home will be for his son and CEO, James Murdoch, who will receive $70.6 million once the deal closes. Both sons would also receive an additional $22 million in severance pay if fired prior to June 30.
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The Disney-Fox merger was first announced in December, while SEC filings show that talks were in the works last summer.
In the proposed merger, Disney will acquire 21st Century Fox’s film studio and a collection of TV assets, and Disney will take over once the deal is closed. That means the Murdochs are likely to be out of a job soon, but not without compensation.
For now, it seems unlikely that the Murdoch brothers will receive the extra $22-million compensation package for being let go before June 30, as the deal is not expected to close until later in the summer.
This week, 21st Century Fox President Peter Rice told staffers at Fox Network Group that the merger would likely be completed by the end of the summer. Once completed, Fox branches that are not part of the Disney deal will be renamed. Related: Is Silver Poised For A Massive Break Out?
Media also revealed this week that Comcast Corp. had outbid Disney for Fox, offering 16 percent more but the higher price tag came along with greater regulatory concerns that made Disney’s offer more attractive.
Comcast reportedly offered $34.41 per share for Fox’s entertainment portfolio, while Disney’s offer originally came in at $23 per share, before being increased to $28 per share in August.
The final share value listed in the Wednesday SEC filing was $29.54 per share—Disney’s December 13 closing price.
Not only did Fox reject Comcast’s bid, but Murdoch also had his sights set on beating out Comcast to control British Sky Plc, and it’s getting help from Disney to do it. Earlier in April, media reports said Disney could step in to buy Sky News if Fox acquired Sky. Such a move would help bypass a regulatory hurdle in the UK, where authorities fear that control of Sky would give Murdoch too much influence in the British media industry. Initially, Murdoch offer $16.4 billion for Sky Plc., and rumors now are that he might raise his bid.
For Disney, the move makes sense because Comcast it’s a major U.S. rival, controlling NBC Universal, and also trying to outbid Fox for Sky.
Disney shares are down nearly $10 since the start of the year, as the S&P 500 tread negative waters for the quarter.
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Shares in 21st Century Fox (C1B) are relatively unchanged over the quarter:
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Australian-native Rupert Murdoch and family are already worth $15.4 billion, according to Forbes’ real-time net worth indicator. Globally, he ranks 94th on Forbes list of billionaires, and 31st among U.S. billionaires.
By Charles Benavidez for Safehaven.com
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