Considering Wall Street Chatter: Apple's Acquisition of Disney.

April 18, 2017, 2:15 PM

Can you just imagine it?

From The Star Online: "LOS ANGELES: Apple could potentially find the cash to pull off a US$200bil (RM880.80bil)-plus takeover of Disney – creating a company worth US$1tril (RM4.40tril) with "almost limitless opportunities in content and technology."

That's according to a speculative analysis from RBC Capital Markets, which in a note to client said such a colossal tie-up would be contingent on Apple getting tax breaks to "repatriate" overseas cash.

"Recently, investors have increased their expectations that Apple could seriously consider acquiring Disney," RBC analysts Steven Cahall and Leo Kulp wrote in the note.'"

And talk about Comcast's worst nightmare!

Replies (9)

April 18, 2017, 9:04 PM

You mean Googlecast? ;^)

Edited: April 19, 2017, 10:12 AM

The extension of Robert Iger's contract is telling. The Wall Street media class continues to struggle with identifying who will fill the CEO spot after he skates. It would certainly ease market minds if Tim Cook was suddenly at the helm.

And there is no doubting both the symbiosis between the two companies and the fact that they are already in bed with each other.

April 19, 2017, 2:07 PM

Under Steve Jobs I could certainly see this happening. He had the shares to at least get the ball rolling, and having ABC, ESPN, and of course Disney in the Apple stable would have ensured the long rumoured Apple-TV-thats-actually-a-TV would have the content needed to be a viable product. I also think it certainly fits their competencies better than the Apple Car project.

However now, I think its just talk. RBC seem to have a habit in my experience of being wrong about Apple every time they talk about them.

April 19, 2017, 2:30 PM

Not a prediction ... More a question of is it a viable consideration?

April 19, 2017, 5:17 PM

Apple has the cash, but what else does it bring to the table, in terms of leadership, innovation, and synergy with Disney's assets? At the moment, not much, I'm afraid. Google would be a better suitor for Disney, given the potential synergy with Google's distribution channels.

Edited: April 20, 2017, 12:35 AM

Disney will be a drag on Apple's earnings. Disney requires high infrastructure spending that restricts margins to 20 to 25%, which is already higher than the industry average. The movie industry is high risk and 50% of movie revenue is shared with theaters in first few weeks. Apple easily make 40% margins. So I just don't see this this happening.

April 20, 2017, 7:39 AM

Yeah, I do not see it happening...sorry. I think Disney is too large.

April 22, 2017, 5:27 PM

RBC analysts were likely simply speculating at the potential this merger could result in, but it's very unlikely that it'll happen, and the markets prove so. Although TWDC is a king in content and Apple a king in distribution platforms, the combined "super-company" will simply be too large to manage. Also, if AT&T is having issues acquiring Time Warner, there's no way the Trump Administration would approve of this.

April 23, 2017, 5:24 AM

I don't think the administration would have much of a choice.

Apple and Disney don't compete, they have no overlapping areas of interest where anti-trust regulations would kick in. There would be no legal basis as far as I can see for any intervention.

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