Disney-Fox: Relief, Gamesmanship, Anxiety, Layoffs Timeline & No Disneyland Perks On Day 1 Of Mega Company
About 15,000 of the 22,400 21st Century Fox employees woke up with a new employer this morning as Disney’s $71.3 billion acquisition of Fox assets officially closed at 12:02 AM ET last night.
But as the newly minted Disney staffers drove to work, they were reminded who owns the famed Fox Studios lot in Century City as they were greeted by a large “Welcome to Fox” banner splashed at the main entrances (pictured above).
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That is a case of some good old gamesmanship and ribbing on behalf of the Murdochs who retained the prized real estate, said to be worth north of $1.5 billion, in the portfolio of the slimmed-down Fox, while leasing a large chunk of the property to Disney for the next 7-10 years.
The Simpsons, 1998
Virtually all Disney-fied Fox employees are staying put in their current Century City digs with some of the top executives, including Peter Rice and Dana Walden, as well as the recently brought in Craig Hunegs — who all are overseeing TV divisions on both sides of the merged entities — splitting their time between offices at Fox and on the Disney lot in Burbank. Additionally, Disney CEO Bob Iger is expected to also have an office and presence in Century City.
In the “Historic Day for Our Company” memo Iger sent overnight to existing and new employees after the close of the Disney-Fox deal, he shared his excitement over finally completing the transition and his big plans for the future.
He also spoke of “the challenging work of uniting our businesses” and promised that the company is “committed to moving as quickly as possible to provide clarity” on the pending layoffs, believed to be as many 4,000 across the two sides of the combined company.
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The memo reflects the mixed feelings among Disney employees today: relief that the protracted merger proceedings are finally over — some even greeted each other with “Happy merger” this morning, — cautious optimism about the prospects of the newly bulked up Disney against the likes of Netflix, Amazon and Apple, and apprehension over the fallout from the integration process.
The uncertainty surrounding the job prospects of employees in the merging businesses, especially in areas expected to be impacted, such as distribution and corporate (BA, legal, etc), has been creating a lot of anxiety ever since the Disney-Fox deal was first announced in late 2017.
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According to a “Disney Transition Guide” distributed by HR to Fox transplants this morning, the staff reductions related to the merger are expected to be completed within the next one year.
Additionally, for the Fox employees not currently locked into contracts, their compensation is not going to be brought down to Disney standards right away.
As we previously reported, on average, Fox’s TV executives are paid at least 20% more than their Disney counterparts. Disney is known for its lower base salaries, though the company is said to be making up for that with compensation packages that include stock and bonuses.
Per the guidelines issued today, the new Disney employees are not to get “less favorable” salary and bonuses than what they had at Fox through December 2020.
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But for those now-former 21st Century Fox who were hoping to get the coveted free Disneyland passes and use them to take their families to the “Happiest Place on Earth” right away, they will have to wait.
Per the HR memo, the traditional Disney perks, including Disneyland passes and discounts on Disney merchandise, they will go into effect for the new Fox additions by end of 2019. Which means that many of those who will be laid off in the integration likely won’t be able to get a free Disneyland trip before they leave.
But their exit packages remain as generous as previously promised, based on the length of their tenure at the company.
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