Disney-Fox Inches Closer as Mexico Approves With Terms

(Bloomberg) -- Mexico’s telecom regulators approved Walt Disney Co.’s $71 billion purchase of 21st Century Fox Inc.’s entertainment assets, provided the companies agree to sell the Fox Sports channels and programming rights in the country.

The IFT, as the agency is known, concluded Disney’s ownership of ESPN and Fox Sports would create a concentration, leaving only Grupo Televisa SAB as the remaining competitor in that specific market. The outcome of Monday’s vote was announced on Tuesday. Another Mexican antitrust regulator, Cofece, had already approved the deal in February.

The companies now have 10 days to accept the IFT’s terms.

Mexico was the last major holdout on the deal, and Disney now expects the purchase to close on March 20. Brazil’s regulatory agency Cade approved the deal last month under a similar divestment agreement. The parties agreed to the sale to get the green light.

In the U.S., Disney agreed to sell Fox’s 22 regional sports networks after the Justice Department said the ownership of those channels and ESPN would give the company undue influence in sports broadcasting. The company will also sell its 50 percent stake in A+E Networks in Europe to satisfy regulators.

The IFT gave Disney six months to divest the Fox Sports assets in Mexico, though the company can get a six-month extension if it has a valid reason. An independent auditor must be hired to supervise the process.

Beyond sports programming, Disney must keep its National Geographic brand separate from its A&E’s channels, which include A&E, History, H2 and Lifetime.

To contact the reporters on this story: Andrea Navarro in Mexico City at anavarro30@bloomberg.net;Anousha Sakoui in Los Angeles at asakoui@bloomberg.net

To contact the editors responsible for this story: Brendan Case at bcase4@bloomberg.net, Nick Turner, Rob Golum

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