Will Disney Buy Universal? | Our Analysis & Predictions
Disney buying Universal is an often debated subject amongst theme park and movie fans alike.
With some of the most popular franchises and properties owned by both entities, many want to see Disney purchase Universal and become an entertainment superpower.
But is this even possible or likely? In this guide, we'll detail our analysis and predictions about a hypothetical acquisition of Universal by Disney!
Questions We'll Answer About Disney Buying Universal:
- Why Would Disney Buy Universal?
- Will Disney Buy Universal?
- Has Disney Considered Buying Universal?
Why Would Disney Buy Universal?
Disney buying Universal would be an exciting move that would give it near dominance in the theme park and entertainment industries.
While other theme park operators like Cedar Fair, Six Flags, Merlin Entertainment, and SeaWorld do have a large number of theme parks around the world, the scale of their operations is nothing like Universal and Disney.
Universal and Disney are by far the premiere companies in the theme park space, and they most directly compete with each other compared to the other theme park operators.
Especially in Florida, where millions and millions of people visit each year specifically for theme parks, Universal and Disney are the two theme parks most visitors debate between, while the others are looked at as more secondary attractions.
If Disney purchased Universal, they would have a massive share of the theme park industry and take their primary competitor out of the picture.
Nearly everyone visiting a theme park in California or Florida would be visiting a Disney property.
Purchasing Universal also solves a massive issue for Disney: Marvel!
The Walt Disney Company owns Marvel Studios but can only use many of the Marvel characters and films at their theme parks on the West Coast.
Universal has a legal agreement to use most of the Marvel characters exclusively at its theme parks in Florida where Disney cannot. This agreement predates Disney's acquisition of Marvel and it still stands today!
Purchasing Universal would finally allow Disney to use all of the Marvel characters at its theme parks in Florida!
But this also expands beyond just the theme parks themselves.
Disney would also control all of the hotels Universal owns, which are another massive money maker and another considerable part of the decision-making process between visiting Universal or Disney.
With such a massive slice of the tourism industry under Disney's control as it relates to theme parks, it would be hard for anyone to compete with them or pressure their pricing, attractions, and other offerings like Universal does.
Disney purchasing Universal would also give them another huge slice of the entertainment industry.
For the purpose of this article, we'll separate Universal Pictures, from its owner NBCUniversal, who owns countless TV channels and other media properties.
If Disney bought Universal, they'd also eliminate one of their competitors in the film industry, as well as acquire a lot of valuable intellectual property to make movies based on
Universal currently owns the following very popular properties that would now be under Disney's control:
- Secret Life of Pets
- Fast & Furious
- Jurassic Park
- Back to the Future
- How To Train Your Dragon
- Kung Fu Panda
- The Invisible Man
- The Mummy
- Creature From The Black Lagoon
- Felix The Cat
- Curious George
As you can see, this is a massive list of very popular and valuable characters and franchises Disney could own!
With an acquisition of Universal, Disney would eliminate one of their competitors and now own dozens of new franchises to make movies, television shows, and theme park attractions with.
Will Disney Buy Universal?
If Disney buys Universal it likely won't be anytime in the near future.
At this point in time Universal is worth far more than Disney can sustainably pay for.
The Walt Disney Company would need to borrow a ton of debt to finance their purchase of Universal, similar to how they acquired 21st Century Fox for nearly $71 billion.
This massive amount of debt puts a significant strain on Disney's financial capabilities as they of course have to pay back the debt, along with their normal operating expenses and of course all of the interest and fees associated with this debt.
Disney is still in the process of making their purchase of 21st Century Fox a profitable business move and has a ton of debt remaining on their balance sheet from the purchase.
This makes Disney's ability to purchase Universal nearly impossible at this point.
Now, let's say Disney did have the financial means to purchase Universal, and NBCUniversal was willing to sell... would Disney do it?
We think so!
The move makes sense for Disney as so much of Universal's businesses and franchises could be seamlessly integrated into Disney.
From owning nearly all of the theme park real estate in Florida to finally owning all of Marvel, as well as some of the most popular content in the world like Minions, Shrek, Jurassic Park, and Fast and Furious - Disney would become a force in the entertainment industry unlike anyone else!
Has Disney Considered Buying Universal?
While owned by Vivendi, a French Media company, between 2004-2011, Universal Studios ran into issues with park attendance and overall popularity due to the effects of the Great Recession which cut travel spending out of a lot of people's budgets.
Theme parks certainly weren't spared by the Great Recession and Universal would see attendance drop and stagnate at low levels for years.
With a significantly reduced value because of the financial fallout and Vivendi already shopping Universal around for a potential buyer, there was a window for Disney to acquire Universal at a great value.
While never confirmed, there were many rumblings about Disney acquiring Universal and what means they would need to take to do so.
Ultimately, Disney's desire to purchase Universal never made it out of the very early exploratory stages, and Comcast would eventually buy NBCUniversal and all of its assets.
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