Chinese Company ‘Tencent’ May Buy Disney

After being crippled by Coronavirus, Disney may have no choice

All hell has broken loose for fans of Disney who never dreamed that their beloved juggernaut would be taken down by a global pandemic.

After bleeding $30 million a day during the coronavirus crisis, Disney is reportedly at the negotiation table and discussing buyout agreements with several compelling global players.

According to Chinese news outlet 环球人力资源智库, Apple was the first to make a bid for majority ownership of Disney stock. However, according to the report, this bid was short-lived before quickly being outmatched by Chinese giant Tencent.

Chinese Influence

Tencent is the company responsible for developing Chinese communication, banking, and everything else mega-app WeChat.

The aforementioned report published in China makes logical sense because Tencent owns a piece of hundreds of entertainment companies all over the world, the most famous of which being gaming companies, including Blizzard and many others.

Tencent’s influence over Blizzard was most notable during their most controversial moment in 2019 when Blizzard banned a player from competition for speaking out against China during the Hong Kong protests.

Companies that are in part owned by Tencent have a precedent for acting in the best interests of the Chinese communist party, so it can be assumed that this influence could be easily extended to Disney.

666

According to the article, Tencent is interested in buying 66.6% of Disney’s stock, giving themselves a controlling position in the company.

What could this mean? It could realistically mean that going forward, Disney movies would take a more sympathetic position towards the communist party and the goals of China.

Disney Parks in Hong Kong, Japan, and elsewhere could be used as bargaining chips during negotiations. While Tencent isn’t the Chinese government itself, The Chinese government has an enormous amount of influence over decisions that companies in China make.

Don’t Panic… Yet

The deal has yet to happen, so there’s no reason to fret yet. We must also remember that all news media coming out of China should be taken with an enormous grain of salt.

This article could be nothing more than a chance for China to feel grand during a genuinely terrible moment for American business… or it could be an insight into what’s really going on in Disney boardrooms as the company fights for its life.

One thing we can know for sure is that the Disney that exists in 2021 will look nothing like the Disney that existed in 2019. For now, the company has cut-off the salaries of 100,000 employees who were furloughed and waiting for operations to go back to normal. One thing is for sure, Disney is going down fast.

If you use WeChat (owned by Tencent) and can read Chinese, you can read the article I referenced and others by scanning the below QR code.

Also, now might be the time to talk to your financial advisor about selling your Disney shares. *This does not constitute financial advice.