Disney CEO Bob Iger’s earlier statement about being open to selling some of the company’s cable networks and local ABC stations seems to have caught the attention of Byron Allen, owner of the Weather Channel and other companies. According to Bloomberg, Allen has made a whopping $10 billion offer to acquire FX, National Geographic, ABC Network, and Disney-owned ABC affiliates.
The offer is said to be based on the assumption that these networks generate around $1.25 billion in earnings before interest, taxes, and other expenses. Bloomberg cites a person familiar with the matter as the source of this information. This move comes after Allen’s reported failed attempt to purchase BET from Paramount earlier this year, as the network decided not to sell.
However, Disney has come forward to deny any decision to sell these networks. In a statement on their website, the company said, “While we are open to considering a variety of strategic options for our linear businesses, at this time, The Walt Disney Company has made no decision with respect to the divestiture of ABC or any other property, and any report to that effect is unfounded.”
This statement was issued in response to rumors that Nexstar, a broadcasting company, was eyeing the Disney-owned ABC affiliates for its portfolio of local broadcast stations. Nexstar executive Tom Carter, who recently stepped down and now serves as an advisor to the CEO, mentioned in an investor conference that a deal could be possible. He acknowledged that while a few Nexstar or ABC stations might need to be divested, the transition could be relatively smooth.
Both the Bloomberg report and Disney’s denial may hold truth. It is plausible that Disney is exploring its options and weighing the potential offers. However, similar to Paramount’s decision not to sell BET, Disney could ultimately choose to retain ownership of these networks.
