Disney-Fox Deal Passes in Brazil With Divestment Accord

(Bloomberg) -- Walt Disney Co.’s $71 billion purchase of 21st Century Fox Inc.’s entertainment assets was approved in Brazil after the companies agreed to sell the Fox Sports channel and program rights in the country.

The regulatory agency Cade concluded Disney’s ownership of ESPN and Fox Sports would leave just one other competitor and give the company too much market power. The parties agreed to the sale to get the greenlight, and the deal was approved by Cade’s board in a 5-to-1 vote on Wednesday.

Brazil was among the last major holdouts on the deal. Disney agreed to sell Fox’s 22 regional sports networks in the U.S. after the Justice Department said the ownership of those channels and ESPN would give the company undue influence in sports broadcasting. The company also will sell its 50 percent stake in A+E Networks in Europe to satisfy regulators.

The sports networks were the only part of the deal that sparked regulatory concern in Brazil. During the two months in which the deal was before Cade’s board, the companies tried to negotiate milder remedies. Disney Chief Executive Officer Bob Iger traveled to Brazil this month for a meeting.

In Brazil, Fox Sports’ broadcast rights include the South American soccer competition, known as Copa Libertadores. The decision was also discussed with Mexican authorities, where regulators are said to seek similar remedies, the person added.

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