Disney Ends Round 1

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Last week, Comcast (NYSE: CMCSA) shocked the world with an unsolicited $54 billion takeover bid for Disney (NYSE: DIS), or about $66 billion including the assumption of debt. As expected, Disney's board of directors unanimously rejected the offer as too low, but left the door open for a higher bid.

Will Comcast bid up?

In a press release, Disney cited that the current offer -- 0.78 Comcast shares for each share of Disney -- works out to $3.60 per share less than where Disney closed on Friday. Yes, this neglects the part where Disney jumped on news of the bid last Wednesday, but then again, Comcast subsequently sold off, which prices the deal even lower at $48 billion.

Comcast responded by saying that its offer "reflects a full and generous valuation" relative to Disney's long-term prospects and represents a premium to Disney's pre-bid share price. Some have expressed concern over whether Comcast can even afford to make an offer that Disney might demand.

In an interesting twist, Disney's board of directors went so far in its latest statement as to express "confidence in the business, financial, and creative direction of Disney under the leadership of Michael Eisner and his management team."

Take that for what it's worth. A guy doesn't attract a date by acting like he needs one, and Disney isn't going to solicit a higher bid by admitting it has management issues. The dance is just getting started. If Comcast really wants Disney, it will find some way to fire back and bid up.

What do you think about all this drama? Give us your take on the Disney discussion board.

Jeff Hwang owns no shares in either of the aforementioned companies, and can be reached via e-mail by clicking here.