People may still be reeling at Disney’s huge power grab in their acquisition of 21st Century Fox, but reports say another big acquisition could be on the horizon.
Analysts from Citi are predicting a 40% likelihood of Apple acquiring Netflix. Business Insider says that the newly-passed corporate tax cuts have made the acquisition look feasible and very promising for Apple.
Apple is reported to have a lot of funds overseas, and this tax cut could allow Apple to repatriate the money to make the Netflix acquisition without suffering a huge tax hit. The acquisition makes a great deal of sense for Apple, as the company has tried rolling out original content in the past with little success.
Many users have even migrated away from iTunes in favor of Hulu or Netflix when it comes to engaging in their favorite movies and television shows. Aligning with Netflix could help Apple not only get a corner market on content streaming, but original content creation as well. Apple has just recently dipped its toe in the waters of original content creation with a new scripted show starring Jennifer Aniston and Reese Witherspoon.
According to Citi analysts Jim Suva and Asiya Merchant, the time is now for Apple. “The firm has too much cash — nearly $250 billion — growing at $50 billion a year. This is a good problem to have.” It just may be the perfect time for the company to acquire Netflix. Plus, Suva and Merchant say Apple would likely only need a third of their cash to land the streaming service.
We’ll have to see if this prediction comes true. The report came out before the Disney/Fox merger was announced, but it still seems like an Apple/Netflix merger is a real possibility.