Increased heat over a possible Disney-Pixar deal has the biz abuzz, sending Pixar’s stock price — and hopes for a reconciliation — soaring higher than one of the Incredibles.
On Thursday evening, a deal indeed seemed imminent, but it was unclear whether it was simply a renewal of the Disney-Pixar distribution agreement or if Disney would be taking a stake in the toon firm, considered a less likely possibility.
Late Thursday, a Disney spokesperson said there was nothing new to report.
At one point in the day, the company’s share price had gained nearly 10% in two days, largely on the strength of deal rumors. While it did fall nearly 4% Thursday afternoon after investors apparently reconsidered, it still closed at $56, more than $3 higher than it opened the week.
Disney and Pixar have been in an elaborate dance for several months over a renewal of the distribution deal, which expires after “Cars” is released later this year. On Tuesday alone, unconfirmed rumors of a deal or a Disney stake sent Pixar’s stock climbing nearly 8%.
Also contributing to the spike is the fact that Disney prexy Robert Iger has recently made overtures to Pixar chief Steve Jobs. Earlier this week, he committed to providing more ABC and ESPN content on the video iPod, owned by Jobs’ Apple.
If the Disney-Pixar deal is not renewed, another distributor would likely come in to offer Pixar a highly favorable pact. But observers said many Pixar investors preferred a Disney arrangement because it would preserve the animation company’s ability to produce and profit from sequels.
Disney controls the sequel rights to Pixar films — “Toy Story 3,” for instance, is already in production — and could make its own go of it if a deal with Pixar fell through.
This week also saw an increase in short-term call options for Pixar — effectively a signal that investors thought the stock would continue to rise in the next few weeks.
Despite the fact that Pixar is seen as holding significant negotiating leverage, it is Pixar that is being affected by Disney interest, not vice versa. Disney’s stock has remained relatively stagnant since the rumors intensified, in the last three weeks hovering around $24-$25. It closed today up 42