We all know of 20th Century Fox right? The famous intro with the spotlights and big 3D text, you know the one. Anyway, Fox recently wanted to purchase Time Warner but it seems now they have changed there mind and damaged Time Warner in the process. The decision to back out of the deal was made by Fox on Tuesday and since the announcement, share prices for Time Warner have dropped by 11%, oh dear indeed.
The whole thing came around in June earlier this year when Fox offered a higher price per share then the current bidder at the time. The current bid was $85 per share and Fox said that they wouldn’t pay more than $90 $95 per share, meaning they would willingly go higher than $85. The news of Fox offering a deal sent the Time Warner shares up above the current $85 value, which was good until Fox backed out. Fox did offer a $6 billion share buyback program to calm the disappointed shareholders down, which was a nice thought but pretty irrelevant now. Since Fox have made offers to Time Warner, offered a $6 billion buy back program and backed out of the deal completely, their shares have actually risen in value by 7%. Makes you wonder, was this all a plan by Fox to get an edge over Time Warner in the stock market or just an unfortunate result of a scrapped deal?
Thanks to Tweaktown for supplying us with this information.
Image courtesy of Tweaktown.