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Comcast Corp offered $65 billion on Wednesday to lure Twenty-First Century Fox Inc away from a merger with Walt Disney Co, launching the first salvo with its 20 percent higher offer and setting up a bidding war between two of the largest U.S. media companies.

Comcast Chief Executive Brian Roberts said he was highly confident regulators would allow Comcast to acquire most of Fox’s media assets after AT&T Inc’s court victory on Tuesday, which allowed it to buy Time Warner Inc for $85 billion.

People walk by the headquarters of 21st Century Fox on June 13, 2018 in New York. Comcast, the giant cable operator, on Wednesday officially made a $65 billion all-cash bid for the majority of Fox.

Spencer Platt/Getty Images

Some analysts see difficulties for Comcast-Fox, which would add Fox’s movie and television studios to Comcast’s NBC Universal, but Roberts said in a letter to Fox that he would offer the same conditions as Disney and promised to fight for the deal in court if necessary.

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Comcast is expected to lead a wave of traditional media companies trying to combine distribution and production to compete with Netflix Inc and Alphabet Inc’s Google. The younger firms produce content, sell it online directly to consumers and often offer lucrative targeted advertising.

A merger between Fox and Comcast would create a company with a stable of well-known media brands and franchises, such as the X-Men superheroes. A combined company would hold the rights to air Fox’s long running TV show “The Simpsons,” the Olympics and Premier League Soccer.

Major sports and news assets including Fox News, Fox Business Network and Fox Sports would be spun off into a separate company.

Shares of Comcast, Fox and Disney were barely changed in after-hours trade.

Comcast in a statement outlined an offer that was similar to Disney’s, including a commitment to the same divestitures. It said that it would agree to litigate any action taken by the Justice Department to block the deal.

Comcast offered $35 per Fox share for the media assets, compared with Disney’s stock offer, worth $29.18 per share at the close of trade on Wednesday.

Comcast also offered a $2.5 billion reverse termination fee if the deal did not go through, the same as Disney. It also offered to pay Fox’s $1.525 billion breakup fee owed Disney, if Fox went with Comcast.

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Comcast said it intended to pursue its $30 billion acquisition of Sky Plc in parallel with its Fox bid. Comcast bid for Sky in April, after Fox’s bid for the remainder of European pay-TV group it did not already own was delayed by regulators.

Fox in a statement said it had received the proposal and would review it.

Justice Department lawyers who tried to stop AT&T’s $85 billion deal expect consumers will lose out as bigger companies raise prices, and some lawyers saw that as a concern in a Comcast-Fox deal which would put two movie studios and two major television brands under one roof.

“One cannot ignore the fact that there’s less independent content to go around,” after the AT&T deal, said Henry Su, an antitrust expert with Constantine Cannon LLP.

Still, the AT&T court fight gave Comcast valuable information about how to structure a Fox deal, said David Scharf, a litigation expert with Morrison Cohen.

“Any deal that’s coming down the pike that’s not baked yet knows the government’s playbook. They know what the government is concerned about,” he said. “They can learn how to structure a deal to make it more palatable.”

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Disney itself has “surgically” structured a transaction that “might be doable,” avoiding Fox Broadcasting and big Fox sports channels, U.S. antitrust chief Makan Delrahim said last week.

“I don’t think either will have a significant advantage over the other,” given that both Disney and Comcast seem motivated to divest what they need to win a deal with Fox, said Ketan Jhaveri, a former Justice Department attorney who served on the telecommunications task force.

Comcast may have a tough time winning over Fox’s largest shareholder, Rupert Murdoch’s family. They own a 17-percent stake and would face a multi-billion dollar capital gains tax bill if he accepted an all-cash offer from Comcast, tax experts have told Reuters.

Craig Moffett, an analyst with MoffettNathanson, said in a research note that Disney could prevail for other reasons.

“Disney has the superior balance sheet, cost of debt, equity and rationale to emerge victorious over Comcast in a bidding war,” Moffett said.

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