The takeover includes Fox’s stakes in British broadcaster Sky PLC (LON:SKY) and video streaming service Hulu as well as its film studio, Asian pay-TV operator Star TV and regional sports networks.
Rupert Murdoch’s company will retain its Fox News and Sports channels.
The news comes just as Disney's 'Star Wars: The Last Jedi' looks set for an estimated US$425mln opening weekend, providing a further uplift for the company over the Christmas period.
Under the deal, the Murdoch family will take a 42.5% stake in Disney.
“We are extremely proud of all that we have built at 21st Century Fox, and I firmly believe that this combination with Disney will unlock even more value for shareholders as the new Disney continues to set the pace in what is an exciting and dynamic industry,” said Murdoch, executive chairman of 21st Century Fox.
Disney chief executive Bob Iger will continue to run the business until 2021.
James Murdoch, the chief executive of 21st Century Fox, was reportedly mooted for a senior role at Disney’s enlarged group but he was not named in the new corporate structure. However, he is expected to leave Fox to pursue other business interests once the deal is completed.
Disney readies launch of video streaming service
“The acquisition of this stellar collection of businesses from 21st Century Fox reflects the increasing consumer demand for a rich diversity of entertainment experiences that are more compelling, accessible and convenient than ever before,”Iger said.
The acquisition comes as Disney prepares to launch its own video streaming service to rival Netflix in 2019. The deal will boost its catalogue of films, which includes the Star Wars franchise, Avatar and Deadpool.
Given that a Disney-Fox combination would see it control almost 40% of the US$11bn US box office, it could struggle to receive regulatory approval.
The US government has been tightening the reins on such deals, blocking AT&T’s US$85bn bid for Time Warner unless it offloads CNN.
What it means for Fox's Sky takeover bid
Fox’s pursuit to buy the remaining 61% of Sky it does not already own is being investigated by the Competition and Markets Authority for media plurality and broadcasting standards. The regulator was to publish provisional findings in January.
The BBC reported that the Disney deal would not alter the CMA’s investigation of the £11.7bn takeover bid for Sky.
If Disney inherits Fox’s existing 39% stake in Sky stake after the CMA has blocked the deal, it could launch a fresh bid for the broadcaster.