Is Netflix Next For Disney? Part I

| About: Netflix, Inc. (NFLX)


Should Disney buy Netflix?

Annaly buys Hatteras.

Buyers circle Yahoo!

Welcome to the Disney-Netflix? issue of M&A Daily

Part II is available here
Click to enlarge

Click to enlarge


Analysts pondering Disney's (NYSE:DIS) future see the potential for big strategic deal ahead.

Click to enlarge

One Disney target could be Electronic Arts (NASDAQ:EA). A bigger one could be Netflix (NASDAQ:NFLX). Disney pushes a ton of movie and TV content through Netflix. So far, Disney has failed to succeed at replicating Netflix's ability to get content directly to consumers. Disney's ESPN could be particularly valuable for Netflix while Netflix's Reed Hastings could be a particularly needed executive for Disney.

SeaWorld (NYSE:SEAS) is one logical long to pair against a Disney short.

Click to enlarge

Others include Fox (FOX/FOXA) and Iconix (NASDAQ:ICON).


Annaly (NYSE:NLY) is buying Hatteras Financial (NYSE:HTS) in a $1.5 billion cash and stock deal. HTS holders get consideration currently worth $15.85 per share.


Western Refining (NYSE:WNR) declared its second-quarter dividend of $0.38 per share paid on May 2 with a record date of April 18. The Western Refining-Northern Tier (NYSE:NTI) $0.39 net arbitrage spread offers a 17% IRR if the deal closes in May.

Norfolk Southern

Canadian Pacific (NYSE:CP) gave up on its efforts to merge with Norfolk Southern (NYSE:NSC).


The Apollo Global (NYSE:APO) acquisition of ADT (NYSE:ADT) received the necessary consents to amend terms of some ADT notes. The consent solicitation on the 6.25% 2021 notes was extended to April 12. The $0.55 net spread offers a 9% IRR if the deal closes by June.


The preliminary proxy was filed for the Columbia Pipeline (NYSE:CPGX) acquisition by TransCanada (NYSE:TRP).


Astoria Financial (NYSE:AF) reached a memorandum of understanding settling shareholder litigation related to its acquisition by New York Community (NYSE:NYCB).


Click to enlarge

The UK's Daily Mail and General Trust (OTCPK:DMTGY) plans to bid Yahoo! (NASDAQ:YHOO). They could be bidding against Verizon (NYSE:VZ), IAC (NASDAQ:IAC), CBS (CBS/CBS.A), Time (NYSE:TIME), KKR (NYSE:KKR), and Microsoft (NASDAQ:MSFT). After looking at the data room, Google's (GOOG/GOOGL) interest has waned.


In a partnership bringing together two firms with a "Q" not followed by a "u", QLogic (NASDAQ:QLGC) is working with Qatalyst on a potential sale.

L Brands

Victoria's Secret parent L Brands (NYSE:LB) is restructuring its business around its main brands while jettisoning non-core merchandise categories.

Done deal.

Gannett (NYSE:GCI) successfully completed its acquisition of Journal Media (NYSE:JMG).

Click to enlarge

Elsewhere on Seeking Alpha

Disclosure: I am/we are long SEAS, ICON, YHOO, HOT.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: Chris DeMuth Jr and Andrew Walker are portfolio managers at Rangeley Capital. We invest with a margin of safety by buying securities at discounts to their intrinsic value and unlocking that value through corporate events. To maximize returns for our investors, we reserve the right to make investment decisions regarding any security without notification except where notification is required by law. We manage diversified portfolios with a multi-year time horizon. Positions disclosed in articles may vary in sizing, hedges, and place within the capital structure. Disclosed ideas are related to a specific price, value, and time. If any of these attributes change, then the position might change (and probably will).

Editor's Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.