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Disney to Decide on Pixar Buy Out

by , 8:10 AM EST, January 23rd, 2006

Disney's board of directors will discuss their options for the future of Steve Job's other company, Pixar, in a regularly scheduled meeting on Monday. According to MarketWatch, there are several options available, ranging from a full buy out and take over, to purchasing a smaller stake in the animation company.

One of the options on the table has Disney purchasing Pixar, valued at around US$7 billion, and giving Steve Jobs enough Disney stock to make him the single largest individual share holder.

The proposed deal with Pixar does not involve Apple Computer. Despite the fact that Steve Jobs is CEO of both Apple and Pixar, the two companies are not tied together. Disney does, however, have other ties with Apple. It sells video programming through the iTunes Music Store (iTMS), including animated shorts from Pixar. ABC, a subsidiary of Disney, also sells some of its shows through the iTMS.

That division, according to the Wall Street Journal, could occasionally put Mr. Jobs in an awkward position. If he has a more active roll in Disney's affairs, there is the potential that he could make decisions at one company that benefit the other.

Mr. Jobs has historically done a pretty good job of keeping his various business interests segregated. Richard Doherty, an analyst at Envisioneering Group, commented "He knows the boundaries of where you're supposed to operate."

There is no word yet on how a Disney buy out of Pixar would effect the available content at the iTMS.

Observer Comments

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Close Name:fartheststar Posts: 214 Joined: 04 Jan 2004
Mon Jan 23, 2006 11:25 am Subject: how is it different

Quote
That division, according to the Wall Street Journal, could occasionally put Mr. Jobs in an awkward position. If he has a more active roll in Disney's affairs, there is the potential that he could make decisions at one company that benefit the other.


How is this any different than what he's doing today?


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Close Name:Biff Posts: 1479 Joined: 08 Apr 2004
Mon Jan 23, 2006 1:48 pm Subject:

There is a difference between negotiating a deal with Disney that benefits your companies and being in charge of Disney and having them do things that unfairly benefit your other companies.


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Close Name:fartheststar Posts: 214 Joined: 04 Jan 2004
Mon Jan 23, 2006 7:52 pm Subject:

Quote
Biff wrote:
There is a difference between negotiating a deal with Disney that benefits your companies and being in charge of Disney and having them do things that unfairly benefit your other companies.


Hey Biff. Totally understand that. My point was, even though Pixar is a smaller company, isn't there the same potential now? I think Steve has been good at not abusing his power there - I just think that the same situation exists. he's in charge of Pixar and could do things that unfairly benefit his other company (Apple).


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Close Name:iJack Posts: 284 Joined: 13 Jun 2001
Mon Jan 23, 2006 8:39 pm Subject:

Yeah FS, I get what you are saying, though it's kind of difficult to see what Jobs could do to have Pixar benefit Apple. They don't even use Apple computers at Pixar, for cryin' out loud. Even if he could, what he would gain at Apple he would presumably lose at Pixar, so why do it?

On the other hand, if he was on the Board of Disney, he could potentially help Apple by providing them with cheaper ITMS content from Disney and ABC/ESPN/Other Disney owned companies.

Aside: I can't imagine why SJ would want to take a seat on Disney's Board. Both Apple and Pixar are lean and mean, while Disney is bloated and cumbersome. He should take the money and run.


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Close Name:Biff Posts: 1479 Joined: 08 Apr 2004
Tue Jan 24, 2006 7:59 am Subject:

Quote
fartheststar wrote:
Hey Biff. Totally understand that. My point was, even though Pixar is a smaller company, isn't there the same potential now? I think Steve has been good at not abusing his power there - I just think that the same situation exists. he's in charge of Pixar and could do things that unfairly benefit his other company (Apple).
Good point.


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Close Name:Biff Posts: 1479 Joined: 08 Apr 2004
Tue Jan 24, 2006 8:13 am Subject:

It looks like reports are starting to trickle out that this could be a done deal. Might be time to start buying some DIS soon!


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