Is Apple Planning Disney Acquisition?

Apple is currently in possession of the largest cash reserve of any company in history – reported to be in excess of $200 billion – and there are strong rumours that the Cupertino company is set to splash that money on an historic acquisition of Disney. According to Steven Cahall, an analyst with RBC Capital Markets, Apple is likely to use its stockpile to buy Disney in an effort to expand its capacity to create ‘content’, reports Business Insider. The idea has also been floated by founder of hedge fund Margate Capital Samantha Greenberg.

While Disney may have made its name with the cartoon characters Mickey Mouse and Donald Duck, plus its lavish animated movies, such as Bambi, The Jungle Book, and Beauty and the Beast, these days the company’s biggest successes are linked to its studio acquisitions; over the last decade, Disney’s biggest blockbusters – The Avengers, Star Wars: The Force Awakens, and Toy Story 3 – came courtesy of its investments in Marvel, Lucasfilm, and Pixar, respectively.

“Apple has talked about the benefit Apple sees when it owns exclusive content, and owning Disney would reduce Apple’s exposure to product cycles, expanding AAPL’s valuation multiple […] It would also be an accretive use of Apple’s cash and even more so if Apple’s $200Bn of offshore cash can be repatriated favourably,” Greenberg revealed in her fourth-quarter 2016 investor letter.

While no moves from Apple toward any potential Disney acquisition have yet been mooted, it seems the story may have legs and could well develop further in the coming months.