Disney in Talks to Buy Pixar

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Walt Disney Co. is in “serious discussions” to buy Pixar Animation Studios Inc., following months of exploring ways to continue their profitable film distribution partnership, The Wall Street Journal reported Thursday.


Disney would pay a nominal premium to Pixar’s current market value of $6.7 billion in a stock transaction that would make Pixar Chief Executive Steve Jobs the largest individual shareholder in Disney, the Journal said, citing people familiar with the matter. Jobs would likely join the Disney board as well.


The outcome of the talks isn’t certain now, and other options are still possible. The companies are still haggling over a final price, and any big fluctuations in Pixar’s share price could derail the negotiations. The two sides could decide on a less-ambitious course, including some form of agreement for Disney to distribute movies that Pixar finances and makes, the newspaper said. Pixar is at a point where it needs to decide who will distribute its post-Disney releases.


The deal under discussion would secure for Disney the most successful producer of one of its most important products animated movies. An acquisition of Pixar would give Disney a leg up in restoring its leadership in the business.


Disney and Pixar have been partners for more than 12 years, allowing Disney to distribute and co-finance profitable Pixar movies that have included “The Incredibles” and “Finding Nemo.” But, amid squabbles with then-Disney CEO Michael Eisner, Jobs said two years ago that he would end that relationship when it expires later this year and seek a new distribution partner. Disney’s current CEO Robert Iger has since made continuing the companies’ relationship a priority.


Shares of Disney rose 4 percent to settle at $26.24 on Thursday.

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