Marvel-ous acquisition for Disney


Spider-Man is moving into the Mouse House. The Walt Disney Company has a cash and stock deal to acquire Marvel Entertainment for $4 billion. The deal doesn’t appear to have any immediate implications for broadcast programming, but there are clearly possibilities down the road.

Disney CEO Bob Iger focused on the strong stable of animated characters, such as Iron-Man, Spider-Man, X-Men, Thor and Capital America, that Marvel brings to Disney. Though they have their origins in comic books, he seemed most excited in his Wall Street conference call by the movies associated with those characters. And while Marvel currently has film and DVD distribution deals elsewhere, Iger hopes to bring that business in-house once the contracts run their course, so Disney will be able to enjoy all of the profits from Marvel’s efforts.

“They’re not bullet-proof,” Iger admitted, when asked about the resilience of Marvel’s film library. But he sees great strength in the franchise.

What appears to have Wall Street analysts most excited is the appeal of Marvel’s characters to boys. Disney, on the other hand, leans more toward girls with its movie output for kids.

The deal did not come cheap. Disney admits that paying $50 per share for Marvel will be dilutive in the current fiscal year, but contribute to growth two years out. The deal will be for $30 cash/share and the balance in Disney stock. Disney also said it plans to buy back enough shares that the closing will not affect its float.

While the price was at a 29% premium to Friday’s closing price for Marvel, “We believe the combination with Marvel provides strategic benefits to Disney in the longer term,” said Barclay’s analyst Anthony DiClemente.  

“Overall, we think Marvel’s library and brands are a solid strategic fit for Disney. Disney should be able to leverage its global reach, execution, and distribution capabilities to grow Marvel’s brands and business opportunities,” DiClemente told clients.

RBR/TVBR observation: No doubt Radio Disney will find some synergies with the Marvel characters down the road. More importantly, that animated film library should be pretty useful for the Disney/ABC cable and television networks and online.