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It's true: Disney has raided the Jim Henson puppet closet, a luckily-timed scheme by Disney CEO Michael Eisner, who's been rumored to be in danger of losing his job. Disney and the Henson Company, as was reported in the press yesterday and according to the memos below, "have signed a binding purchase agreement and expect the transaction to close within two months, subject to receiving the necessary regulatory clearances." Sadly, Disney doesn't get Big Bird and Elmo.

Relatedly, Disney recently rejected an unsolicited bid from Comcast, reportedly because it was a fairly crappy stock trade deal. (Smartly, Comcast refused to adjust their bid, so in the aftermath Disney's stock went down and Comcast's stock went up. Har har.) Michael Eisner, Disney CEO, is getting trashed by former board members — including Roy Disney — for Disney's stock downslide and other troubles (including being roughed up by Steve Jobs at Pixar). Will Eisner save his job by living large with Muppets?

And yes: Eisner really does address his memos to "Dear Fellow Cast Member."

From: Eisner, Michael [mailto:Michael.Eisner@disney.com]
Sent: Tuesday, February 17, 2004 4:07 PM

Dear Fellow Cast Member:

I am pleased to share some very exciting news for our company, as today we
announced an agreement to acquire the Muppets and Bear in the Big Blue
House from The Jim Henson Company.

Disney and the Muppets have always represented a perfect fit, as both
offer distinct and wonderful characters that are embraced by families
around the world. Over the years, our two companies have undertaken a
number of successful projects together, including the fantastic Muppet 3D
attraction at Disney-MGM Studios and Disney's California Adventure, as
well as several films and TV specials. Also, Bear in the Big Blue House
has been a popular mainstay on Disney Channel. In 1990, we were in
negotiations to acquire the Muppets when Jim Henson tragically died. Now,
this marriage made in family entertainment heaven is finally proceeding to
the altar.

Our company and the Henson Company have signed a binding purchase
agreement and expect the transaction to close within two months, subject
to receiving the necessary regulatory clearances. Just so you know, it
will not include the "Sesame Street" characters, such as Big Bird and
Elmo, which are separately owned by Sesame Workshop. The deal does
include non-exclusive production and consulting agreements under which
Henson will develop potential new programming featuring the "Muppets" and
"Bear in the Big Blue House" for Disney.

This new relationship has added personal meaning for me, since I worked
with Jim Henson on the very first Muppets TV special in the 1960s. It was
obvious at the time that he was a creative genius and, as with another
creative genius - Walt Disney - his creations continue to live on past
him.

Kermit, Miss Piggy and the rest of the Muppet gang are well-known and
beloved around the world and will have an opportunity to be seen and loved
by millions more well into the future through Disney's distribution
channels at home and abroad, including home video, family television
programming and consumer products, in addition to their existing theme
park presence at Walt Disney World and Disneyland Resort. We are honored
that the Henson family has agreed to pass on to us the stewardship of
these cherished characters. We are also pleased that this transaction
puts us in a position to work with the Henson Company on future projects.

This great acquisition provides just one more indication of the strength
and growth potential of The Walt Disney Company as well as the worldwide
appeal of the extraordinary Disney family brand.

Michael