Early stage talks have reportedly commenced between entertainment conglomerate The Walt Disney Co.
What Happened: According to insiders, exploratory discussions between the two companies have begun, as reported by Bloomberg. No specific valuation has been put on the table yet, and Nexstar's participation hinges on the right price.
The news prompted Nexstar shares to rise by 5.9%, marking the fourth consecutive session of gains. Disney shares also reacted positively, posting a 1.2% increase.
During a Bank of America conference, Tom Carter, Nexstar's ex-president and current adviser to its CEO and board, expressed Nexstar's openness to acquiring assets from established media companies like Disney.
Yet Carter named potential issues tied to the sale, especially considering the shared telecasts between ESPN, Disney's sports network, and ABC.
Carter called for Disney to provide clearer intentions. Disney's CEO Bob Iger had hinted in July at the possibility of selling traditional TV networks like ABC amid falling viewership while streaming platforms like Disney+ and Hulu gain traction.
Nexstar, the largest owner of TV stations in the United States, is based in Irving, Texas. It owns or collaborates with 200 TV stations spanning across 116 markets and recently took the ownership majority of the CW network.
Why It Matters: The potential sale of ABC to Nexstar suggests a significant shift in Disney's focus toward its rapidly expanding digital platforms. The rise of streaming services like Disney+ and Hulu has been reshaping the media landscape, with traditional networks facing declining viewership. If the sale proceeds, it could mark a pivotal moment in the ongoing transition from traditional broadcast to digital media.
