LOS ANGELES - Iron Man and Spider-Man are joining the family of Mickey Mouse, Donald Duck, and Cinderella in a $4 billion deal announced yesterday in which Walt Disney Co. will buy Marvel Entertainment Inc.
Under the deal, which is expected to close by the end of the year, Disney will acquire the rights to 5,000 Marvel characters. Many of them, including the Fantastic Four and the X-Men, were cocreated by the comic book legend Stan Lee.
Disney chief executive officer Robert Iger said Marvel's comic books, TV shows, movies, and video games amounted to "a treasure trove of content." Iger said the deal would bring benefits such as the ones Disney got from buying Pixar Animation Studios Inc., creator of Toy Story, for $7.4 billion in stock in 2006.
"The acquisition of Marvel offers us a similar opportunity to advance our strategy," Iger said, and "to build a business that is stronger than the sum of its parts."
For Marvel, Iger said being in the Disney camp would mean better global distribution and better relationships with retailers to sell its products. Another storied comic book maker, DC Comics Inc., has been part of a major studio since 1969, when Warner Bros. bought it. DC Comics is the home of Superman, Batman, and Wonder Woman.
Marvel chairman Mort Handel called Disney "a perfect home for our great collection of characters."
One point of the deal is to help Disney appeal to young men who have flocked to theaters to see Marvel superheroes such as Iron Man in recent years. That contrasts with Disney's recent successes among young women with such fare as Hannah Montana and the Jonas Brothers.
Marvel TV shows also already account for 20 hours per week of programming on Disney's recently rebranded, boy-focused cable network, Disney XD, and that figure looks likely to increase, Iger said. The shows are "right in the wheelhouse for boys," he said.
However, analyst David Joyce of Miller Tabak & Co. L.L.C. noted that the $4 billion offer was at "full price."
Marvel shareholders will receive $30 a share in cash, plus 0.745 Disney shares for every Marvel share they own. That values each Marvel share at $50 based on Friday's closing stock prices.
Marvel shares shot up $9.72, or 25.15 percent, to close at $48.37 yesterday; Disney shares fell 80 cents, or 2.98 percent, to $26.04.
Disney investors were probably unhappy to learn that the deal will reduce the company's earnings per share in the short term and might not turn positive until its 2012 fiscal year.
Marvel is profitable - it made $206 million in its last fiscal year on revenue of $676 million - but Disney's earnings per share will drop partly because the company will issue 59 million new shares to finance the deal. Marvel also is releasing two costly blockbusters, Thor and The First Avenger: Captain America in 2011, and income from DVD sales of those films likely would not roll in until fiscal 2012.
Disney said the boards of both companies had approved the transaction, but it will require an antitrust review and the approval of Marvel shareholders.