Furthering its strategy of delivering outstanding creative content, Robert A. Iger, President and Chief Executive Officer of The Walt Disney Company, announced today that Disney has agreed to acquire computer animation leader Pixar in an all-stock transaction, expected to be completed by this summer. Under terms of the agreement, 2.3 Disney shares will be issued for each Pixar share. Based on Pixar’s fully diluted shares outstanding, the transaction value is $7.4 billion ($6.3 billion net of Pixar’s cash of just over $1 billion).*
This acquisition combines Pixar’s preeminent creative and technological resources with Disney’s unparalleled portfolio of world-class family entertainment, characters, theme parks and other franchises, resulting in vast potential for new landmark creative output and technological innovation that can fuel future growth across Disney’s businesses. Garnering an impressive 20 Academy Awards, Pixar’s creative team and global box office success have made it a leader in quality family entertainment through incomparable storytelling abilities, creative vision and innovative technical artistry.
“With this transaction, we welcome and embrace Pixar’s unique culture, which for two decades, has fostered some of the most innovative and successful films in history. The talented Pixar team has delivered outstanding animation coupled with compelling stories and enduring characters that have captivated audiences of all ages worldwide and redefined the genre by setting a new standard of excellence,” Iger said in the press release. “The addition of Pixar significantly enhances Disney animation, which is a critical creative engine for driving growth across our businesses. This investment significantly advances our strategic priorities, which include – first and foremost – delivering high-quality, compelling creative content to consumers, the application of new technology and global expansion to drive long-term shareholder value.”
Pixar President Ed Catmull will serve as President of the new Pixar and Disney animation studios, reporting to Iger and Dick Cook, Chairman of The Walt Disney Studios. In addition, Pixar Executive Vice President John Lasseter will be Chief Creative Officer of the animation studios, as well as Principal Creative Advisor at Walt Disney Imagineering, where he will provide his expertise in the design of new attractions for Disney theme parks around the world, reporting directly to Iger. Pixar Chairman and CEO Steve Jobs will be appointed to Disney’s Board of Directors as a non-independent member. With the addition of Jobs, 11 of Disney’s 14 directors will be independent. Both Disney and Pixar animation units will retain their current operations and locations.
“Disney and Pixar can now collaborate without the barriers that come from two different companies with two different sets of shareholders,” said Jobs in the release. “Now, everyone can focus on what is most important, creating innovative stories, characters and films that delight millions of people around the world.”
“Pixar’s culture of collaboration and innovation has its roots in Disney Animation. Our story and production processes are derivatives of the Walt Disney ‘school’ of animated filmmaking,” said Dr. Catmull in the release. “Just like the Disney classics, Pixar’s films are made for family audiences the world over and, most importantly, for the child in everyone. We can think of nothing better for us than to continue to make great movies with Disney.”
The acquisition brings to Disney the talented creative teams behind the tremendously popular original Pixar blockbusters, who will now be involved in the nurturing and future development of these properties, including potential feature animation sequels. Pixar’s 20-year unrivaled creative track record includes the hits Toy Story, Toy Story 2, A Bug’s Life, Monsters, Inc., Finding Nemo and The Incredibles. Disney will also have increased ability to fully capitalize on Pixar-created characters and franchises on high-growth digital platforms such as video games, broadband and wireless, as well as traditional media outlets, including theme parks, consumer products and live stage plays.
“For many of us at Pixar, it was the magic of Disney that influenced us to pursue our dreams of becoming animators, artists, storytellers and filmmakers,” said Lasseter in the release. “For 20 years we have created our films in the manner inspired by Walt Disney and the great Disney animators – great stories and characters in an environment made richer by technical advances. It is exciting to continue in this tradition with Disney, the studio that started it all.”
“The wonderfully productive 15-year partnership that exists between Disney and Pixar provides a strong foundation that embodies our collective spirit of creativity and imagination,” said Cook in the release. “Under this new, strengthened animation unit, we expect to continue to grow and flourish.”
Disney first entered into a feature film agreement with Pixar in 1991, resulting in the release of Toy Story, which was hailed as an instant classic upon its release in November 1995. In 1997, Disney extended its relationship with Pixar by entering into a co-production agreement, under which Pixar agreed to produce on an exclusive basis five original computer-animated feature films for distribution by Disney. Pixar is currently in production on the final film under that agreement, Cars, to be distributed by Disney on June 9.
The Boards of Directors of Disney and Pixar have approved the transaction, which is subject to clearance under the Hart-Scott-Rodino Antritrust Improvements Act, certain non-United States merger control regulations, and other customary closing conditions. The agreement will require the approval of Pixar’s shareholders. Jobs, who owns approximately 50.6% of the outstanding Pixar shares, has agreed to vote a number of shares equal to 40% of the outstanding shares in favor of the transaction.
The Disney Board was advised by Goldman, Sachs & Co. and Bear, Stearns & Co. The Pixar Board was advised by Credit Suisse.
Separately, the Disney Board approved the repurchase of approximately 225 million additional shares, bringing the Company’s total available authorization to 400 million shares. Since August 2004 through the end of December 2005, Disney has invested nearly $4 billion to purchase nearly 155 million shares. Disney anticipates further significant share repurchases going forward, reflecting Disney’s continued commitment to returning value to shareholders over time.
* Based on Disney’s closing share price of $25.52 as of 1/23/06.
About The Walt Disney Company:
The Walt Disney Company, together with its subsidiaries and affiliates, is a leading diversified international family entertainment and media enterprise with four business segments: media networks, parks and resorts, studio entertainment and consumer products. Disney is a Dow 30 company, had annual revenues of nearly $32 billion in its most recent fiscal year, and a market capitalization of approximately $50 billion as of January 23, 2006.
Investor Conference Call:
An investor conference call will take place at approximately 2:15 p.m. PT / 5:15 p.m. ET today, January 24, 2006. To listen to the Webcast, turn your browser to http://www.disney.com/investors/presentations (the webcast will be streamed via Windows Media Player and Real Player) or http://corporate.pixar.com (Pixar link not currently available).
An .mp3 version of this Webcast replay will also be available approximately 24 hours after the Webcast concludes at http://www.disney.com/investors/presentations
Ummm . . . editg5 — can you say, WRONG???
Pixar will stay right where it is. And it’ll probably GROW as a result.
‘Course, you’d know that if you weren’t just spouting off at the mouth.
Isn’t it the perfect position Bill Gates always dreams to be in? Having influence over both technology and entrainment industry at the same time? Boy, it’s not March yet but Bill is sure green with envy!!!
Sing along now! “It’s a nano world after all, It’s a nano world after all…”
MCCFR
The Pixar people are now pretty much the only creative types in Disney’s animation division. Eisner destroyed it completely. I was taking the mick out of a Windows-zealot I know who is quite high up in Disney’s IT department, telling him I can give him OSX training for a fee now SJ is his boss. He laughed, and said that they were already sending in the Mac Gestapo to smash all the PCs.
Sadly he was only joking, but I bet the Mac users in Disney are feeling a pretty smug bunch today.
Few points:
Lasseter gets to play in the Disney parks… he has been wanting this for SOOOOO long.
Brad Bird has wanted to make a live action pic… Disney Feature Films is now open to him.
Ed Catmull in charge. Totally into making great movies.
Steve Jobs free of the day to day at Pixar (not that he was that involved) now able to concentrate on Apple.
Remember the same people are still in charge at Pixar so there is not going to be a drop in quality. They are already working on the next pic… Cars is in the can or close to it.
“Disney and Pixar can now collaborate without the barriers that come from two different companies with two different sets of shareholders,” said Jobs in the release.”
Have to differ with Steve-O a lttle on that one. The different shareholders weren’t necessarily the problem. The management power struggles were the key issue. Both companies could have profited quite well as independent entities if they cooperated more effectively.
Very interesting comments so far,however a couple of point
: Non independant director, big deal he (stevie) will be the single largest shareholderof disney stock, which puts him in a very powerful position.
: “this has nothing to do with apple” who are u kidding, mate
: most of he comments so far have looked at this deal on the surface.
My view is a longer term point,
I dont think the timing of this deal is coincidental, and i imagine stevie is viewing this deal is part of “his” long term goal, what is the goal the “digital living room” yes there is a OS war to be won, and i feel that that OS war is “digital living room” inclusive. Its not only about which OS a computer runs. It includes DRM issues (disney influence ) could assist in the DRM war which is going on.
Yes we will get “finding Nemo” theme parks, bu there is a bigger prize in this deal
H
Awesome!
Now SJ can dedicate 100% of his time to Apple. Pixar will be fine. Maybe Disney will now dump a great number of their Windows PC with Macs. Maybe Disney will become Apple’s 1st larget IT account. You can only dream
JG
so that’s why Apple removed some new products from Macworld – it is because they understood that all the buzz will be about Pixar/Disney.
Nice.
So does it mean that we are no long seeing the JUMPING IKEA LAMP anymore? sob sob…
Disney bought Pixar, and it will remain a separate company, at least for the time being. Disney benefits greatly by having the Pixar creative brain trusts now running Disney animation. Iger’s not stupid – he say how much Eisner mucked up Disney’s animation. Between Pixar and Dreamworks, Eisner ran off most of Disney’s top animators and storytellers.
Steve will have a great deal of influence. He’s still in charge of Pixar, and he just swapped his stock for Disney stock. That means he runs Pixar as CEO, he can vote (over time) to install board members in Disney as he chooses and influence other shareholders to vote for the same persons, and he can scare the crap out of directors who don’t follow his visions.
Apple benefits by (very likely) getting first-run Disney/Pixar/ABC/ESPN entertainment on iTunes first, perhaps even exclusively. How about, “Buy a new Apple Home Theater and get The Incredibles 2 on Blu-ray DVD free!” Nice tie-ins are coming, bet on it.
I give Steve 2 years before he’s CEO of Disney.
Disney stocks have been in the crapper for years. Jobs wouldn’t have cut this deal for stocks if he didn’t have it in his plans to increase the value of those stocks over time.
Apple and Pixar not connected? I think they are. This deal has everything to do with Disney content on iTunes. Those of you trying to separate Apple and Pixar and Disney aren’t seeing the long-term picture — and you’re just acting like petulant teenagers.
“this has nothing to do with apple”
“why does everybody think Apple gets all of the Disney goodies now.
Steve is a board member of Disney now. But he does not control Disney/ABCs decisions. Apple is NOT involved in this deal!!!!”
You have to be kidding, this will have everything to do w/ Apple. No, Apple won’t immediately offer all Disney-affilliated material but did you notice the new Disney offering made available today? A bunch of classic Disney shorts.
It’s already starting because Iger is just as eager to distribute content in new ways as Jobs. They are definitely on the same page.
Party this weekend for Steve. HooYA
Hey Steve, it’s time to bring back Roy E. Disney! Even if it is just an advisory roll. It would start the healing after the way Eisner treated Walt’s nephew.
Iger recently saw Pixar next feature animated film titled “Cars,” and said it is one of the best films he’d ever seen “I can’t wait for the rest of the world to see it,” he said. Disney and Pixar plan an exclusive preview of the fim in Detroit before the SuperBowl next month. The movie is set to open in theaters this June.
Guess that squashes any rumors that “Cars” will be a flop.
“Iger recently saw Pixar next feature animated film titled “Cars,” and said it is one of the best films he’d ever seen “I can’t wait for the rest of the world to see it,” he said. Disney and Pixar plan an exclusive preview of the fim in Detroit before the SuperBowl next month. The movie is set to open in theaters this June.
Guess that squashes any rumors that “Cars” will be a flop.”
Umm, you’re kidding, right? Please tell me you are kidding. You’re either kidding, or you’re a corporate wet dream.
First Pixar…next comes Apple.
Poor Artiste!!!
I guess ya should checked out the iTMS before posting; Though it’s possible that all the Disney content “Just Added” might be due to coincidence, I sincerely doubt it.
Lay off the sauce, dude, ’cause whatever you’ve been drinking, it’s obviously affecting you more than Apple’s “kool-aid” affects everyone else.
“So much for Apple fans NOT being Jobs-worshipping cultists. He’s just a person. And apparently an asshole of a person.”
I repeat: IT’S ALL ABOUT THE MONEY, IT ALWAYS HAS BEEN AND IT ALWAYS WILL BE.
The only one true thing Steve Jobs cares about is – Steve Jobs.
I love the Mac (I seriously do), but you’ve got to take reality and stare it in the face – it’s painful but true. Steve Jobs want’s to rule the kingdom (no pun intended) just as much as Gates. And everybody hates Gates for that same reason (other than the fact that Windows is a dinosaur and Gates is known for using less than questionable business practices)……
Hi everyone. The creative is the place where no one else has ever been. You have to leave the city of your comfort and go into the wilderness of your intuition. What you’ll discover will be wonderful. What you’ll discover will be yourself. Help me! Please help find sites for: What causes thinning hair in women. I found only this – thinning hair while cutting. Cuts for long thin hair, shampoos of popular confirmation, fly-like as bag and hair, are back mentally selected to apprenticeship. Symbolic hair can be molecular to the wolff-chaikoff probe. With best wishes :cool:, Ohanna from Czech.
U know guys I just want to say hello
” width=”19″ height=”19″ alt=”wink” style=”border:0;” />.
I am from Cuba and also now am reading in English, tell me right I wrote the following sentence: “Other delivery was not nationalised by the goldman trades, foreign share trading.”
Regards
” width=”19″ height=”19″ alt=”grin” style=”border:0;” /> Valeska.
Hi everyone. For visions come not to polluted eyes. Help me! Help to find sites on the: Thin fine hair styles. I found only this –
” width=”19″ height=”19″ alt=”mad” style=”border:0;” /> Thanks in advance. Kelly from Liechtenstein.
Give please. They are ill discoverers that think there is no land, when they can see nothing but sea.
I am from Tuvalu and learning to write in English, please tell me right I wrote the following sentence: “Child in the cards.”
Thank you so much for your future answers 8). Allen.
Good evening. All love that has not friendship for its base, is like a mansion built upon sand.
I am from Darussalam and also am speaking English, tell me right I wrote the following sentence: “More than toilet million teeth spend lifespan in the consumer survey.”
Thank you very much 8-). Rock.