Disney has reportedly been in talks to buy most of 21st Century Fox

Bob Iger CEO Disney

The media corporation 21st Century Fox has been in talks to sell most of itself to Disney, CNBC’s David Faber reported on Monday.

An acquisition would leave 21st Century Fox with a smaller, more focused portfolio of news and sports networks to better compete in a changing media space, the report said.

A deal would exclude the Fox broadcast network because Disney could not own two broadcast networks, the report said. (Disney acquired ABC in 1996.) It would also exclude Fox’s sports channels to avoid regulatory concerns that combining them with ESPN would be anticompetitive.

Disney was reportedly interested in buying Fox assets including its studio division, partial ownership of the UK telecoms company Sky, and networks such as National Geographic and FX.

Disney could benefit from 21st Century Fox’s television properties as it gets ready to launch a streaming service. The company announced in August that it would end its exclusive movie deal with Netflix in 2019 and launch an ad-free, Disney-branded streaming service.

Fox was willing to discuss an acquisition with Disney because its senior management believes the way to scale its media properties is not by buying others, the report said. Both companies aren’t in talks now but could resume them, according to the report.

The report did not include a price that Disney may have offered 21st Century Fox.

Shares of 21st Century Fox spiked 6%, while Disney gained 1% on the news. Other cable networks, including Viacom and Discovery Communications, rallied; Netflix fell. By Akin Oyedele