Disney's Acquisition of Marvel

"Breaking Down Disney's Acquisition of Marvel. Can a mouse and a spider make lots of money together? We'll soon find out. "

The entertainment world was rocked Monday morning by the news that Disney plans to buy Marvel Entertainment for a cool $4 billion. Even the Kingpin would say that's a lot of dough. Marvel's 5,000+ library of characters, including such licensing and publishing powerhouses as Spider-Man, the X-Men and the Hulk, join Disney's classic characters to create an IP library of fearsome might.

The deal was announced by Disney president and CEO Bob Iger at an investor's conference call, where details of the new Marvel emerged a bit. Iger said buying Marvel made sense for Disney because "Marvel has done a good job of understanding its characters and story lines.

What was attractive to us about this deal was that it was about acquiring writers who know these chraracters and story lines well." Marvel's chairman and principal stockholder, Ike Perlmutter, will remain in charge of Marvel's operations, and Iger stressed that the current Marvel management team has been doing a great job and would be allowed to continue doing it.

Marvel shareholders will receive $30 per share in cash, plus 0.745 Disney shares for every Marvel share they own. Marvel's stock immediately went up 25%, or $9.72, closing at $48.37. However, Disney shares fell 80 cents, to $26.04, perhaps reflecting the question marks over certain aspects of the acquisition.

Marvel's periodical comics line has been the industry leader for most of the past decade, and graphic novel sales have also surged with such titles as the homegrown Marvel superhero series, Civil War and 1602, and graphic novel licenses from bestselling prose novelists Stephen King and Laurell K. Hamilton.