Our work on FOX continued this week with a finalization of our valuation and the start of teasing out the different revenue streams that will comprise the bulk of the Disney transaction.

The only way to understand if Disney has paid an appropriate price for FOX (they are handing over 6.5 years of Owners Cash Profits for those assets!) is to take the transaction apart. Fortunately, our Framework makes this relatively straightforward. Here’s a stepwise process:

  • Step 1:   Value the Acquirer Pre-Transaction
  • Step 2:   Value the Target Pre-Transaction
  • Step 3.   Separate the revenue streams being purchased from the Target  (via segment data and transaction details)
  • Step 4:  Apply the new revenue streams to the Acquirers Reveues
  • Step 5:  Revalue the Acquirer using its operating metrics

To get started, we valued DIS back in late 2017. Here is that work. We also have a Framework Forum thread dealing with Disney.

Now we are looking at the target, FOX, as a stand-alone firm. We posted the model for FOX last week and opened up a Framework Forum thread dealing with Fox.

Here is the presentation and Erik will have a recording of the Office Hour presentation in the Archived Webinar section soon.

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