Iger and Jobs sitting in a tree

Over at BusinessWeek Ronald Glover lays out the reasons Jobs won’t sell Pixar to Disney.

Buying Pixar would cost Disney a bundle, maybe $8 billion or $9 billion and could send Disney’s stock into a tailspin. When the rumor first surfaced on Jan. 4, the share price promptly dropped 1.5% in the 45 minutes before the market closed that day. A deal of that size would be a huge drag on Disney’s earnings…

For what it’s worth, my money is still on Disney buying 10%-15% of Pixar, taking the traditional distribution fees and a much smaller share of the world-wide profits plus character and merchandise rights for themeparks and Disney Stores only.

I think this would be the best deal for both. Pixar gets to keep more of its profits but still gets the assistance it needs from Disney (story advice, distribution, character recognition). Disney gets more than the average distribution deal, can continue using the Pixar characters in its themeparks, and is invested in the future of Pixar so is likely to continue providing assistance. Frankly, I don’t know what’s holding a deal like this up unless they’re negotiating over basis points.

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1 thought on “Iger and Jobs sitting in a tree”

  1. I think that deal would damage both Pixar and Disney. The biggest thing the Disney company has going for them is their brand identification. A brand which used to be based on their own creative product and concepts. Now, they have to “borrow” properties from Pixar, Lucas and Spielberg to use on their theme parks and merchandising. I think this delutes the Disney brand name (which has taken a lot of hits in the last 10 years) and doesn’t do Pixar any good either, except as a short term source of cash. Pixar should bite the bullet and expand into entertainment parks, merchandising and television to get the synergism they are trying to get from Disney on the cheep.

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