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Brazil antitrust regulator to reassess Disney-Fox deal because divestiture has yet to happen

A Disney+ streaming service sign is pictured at the D23 Expo, billed as the "largest Disney fan event in the world," at the Anaheim Convention Center in Anaheim, California, in August. Walt Disney Co. said Wednesday it signed up 10 million subscribers for Disney+ within a day of launching its new streaming television service. | AFP-JIJI

Reuters

SAO PAULO – Brazil’s antitrust regulator said on Wednesday it will reassess Walt Disney Co’s (DIS.N) $71 billion purchase of Twenty-First Century Fox (FOXA.O) because the divestiture requested by the regulator as a condition for the merger of U.S. media companies has not happened yet.

“The deal approved in February was contingent on the sale of the Fox Sports channel. As the sale was not finalized, the case will be re-examined,” the regulator known as “Cade” said in a statement.

The regulator said it requested the sale of Fox Sports to maintain the same level of competition in the Brazilian market after the deal, with three different sports options: SporTV, ESPN and the service provided by a new company with the Fox assets.

The companies “tried” to comply with the request, but had not succeeded, the regulator said.

Cade head Alexandre Barreto said the reassessment will consider “other options,” without giving details.

The original decision in Brazil was similar to one by the Mexican telecoms regulator IFT, which also requested in March the sale of Fox sports channels in the country.