Walt Disney has agreed to buy the bulk of 21st Century Fox’s business for $52.4bn (£39bn), in a deal both companies said position them to compete in the rapidly changing media industry.
The purchase includes Fox’s film and television studios, as well as its 39% stake in satellite broadcaster Sky.
Fox will form a news-focused company with its remaining assets.
The move is a sharp shift for 86-year-old Fox owner Rupert Murdoch after more than half a century of media expansion.
Mr Murdoch turned a single Australian newspaper he inherited from his father at the age of 21 into one of the world’s largest news and film empires.
He said the break-up makes sense amid new threats from online advertising and competitors who are streaming entertainment into homes via the internet.
Fox shareholders, who include the Murdochs, will get a 25% stake in the larger Disney.
“With today’s announcement, we launch the next great leg of our journey,” Rupert Murdoch said on Thursday in a call for investors.
He added later: “Are we retreating? Absolutely not.”