There are always rumors circulating about big companies acquiring other big companies. Last November, there was a rumor circulating that Disney was looking to buy the streaming service Netflix, but thus far, nothing seems to have come of that rumor. It’s with that in mind that we head into this rumor. A lot of this seems to be fueled by speculation and circumstance, but regardless, it's worth discussing.
According to speculative analysis from RBC Capital Markets (via Variety), Apple has the potential to purchase Disney for over $200 billion, and if they were to do so, they’d create a company with a value of $1 trillion. This would create a ridiculously large company with “almost limitless opportunities in content and technology.”
Apparently, it’s an idea that sounds appealing to investors, and as such, “investors have increased their expectations that Apple could seriously consider acquiring Disney,” RBC analysts Steven Cahall and Leo Kulp wrote in the note.
Just imagine the power that would come with a company like that. Apple has a huge chunk of the computer and smart phone market (not to mention their cut of music and digital movies), and Disney has come out in recent years as one of the most successful studios on the face of the planet, whose recent Beauty and the Beast film just cracked $1 billion worldwide.
The Variety report also states that if this deal were to happen, Apple and Disney could potentially rival Netflix in a huge way. With Disney’s long list of huge hit movies, it could be quite the gaping hole in Netflix’s library that users could jump over for. This move would allow Apple to diversify beyond tech without having to start from ground zero, or without having to dilute their brand. And it’s not as though Apple isn’t always looking. Last year, Apple CEO Tim Cook stated that they were “open to acquisitions of any size,” and we have to say, Disney certainly fits that bill.
What’s more is that each company would benefit greatly from this. Here’s what Cahall and Kulp wrote in reference to that.
“We like Disney’s fundamentals. Assuming Apple sees the same thing and has the cash, investor anticipation of a prospective transaction only adds conviction to the momentum we see in Disney’s shares.”
Again, all of this seems to be pretty theoretical for now. However, it’s a big “What if,” if there ever was one, and should it actually happen, could mean a huge seismic shift in the entertainment industry that we’ve never seen before.
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