Disney targets the boys with $4 billion marvel buy

Walt Disney has agreed to buy Marvel Entertainment for $4 billion in a deal that would add characters such as Iron Man...

Walt Disney has agreed to buy Marvel Entertainment for $4 billion in a deal that would add characters such as Iron Man,Spider-Man and the Fantastic Four to its entertainment empire.

Disney is striking the biggest media deal of the year one that unites the Incredible Hulk and Mickey Mouse at a time when the entertainment business is struggling to cope with big spending cutbacks by both consumers and advertisers. It is also paying a substantial price,a 29 per cent premium for Marvel shareholders,and is undertaking its largest acquisition since the $7.6 billion purchase of Pixar in 2006.

But none of those risks deterred Disney from seeking out a deal to address an area of concern among investors: How can it better reach more young males. This helps give Disney more important exposure to the young male demographic that they have sort of lost some ground with in recent years, said David Joyce,an analyst with Miller Tabak & Co.

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Indeed,Disney has long been a blockbuster brand with girls thanks to characters such as Hannah Montana,Cinderella and Snow White,but has struggled to achieve the same kind of success with boys.

Movies such as Iron Man 2,due to hit the theaters next year,or 2011s Spider-Man 4 and Avengers should help resolve that issue. Moreover,Disney will be able to use its marketing and entertainment might stretching from ABC to cable television to theme parks to promote and build characters such as Thor in ways Marvel never could.

To acquire Marvel,Disney agreed to pay a total of $30 per share in cash plus about 0.745 Disney shares for each Marvel share they own. The deal was approved by the boards of both companies.

The shares of Marvel shot up to a high of $49.29 before falling a bit to $48.38 in afternoon trading.