Submitted by: kirkland on Wednesday February 11th, 2004 at 11:43 AM EST

Cable TV giant Comcast announced Wednesday that it was launching a surprise $66 billion bid to merge with Disney, a deal that would create one of the largest media and distribution companies in the world.

The stunning proposal comes after private conversations earlier this week, in which Disney Chief Executive Officer Michael Eisner rejected Comcast's request to begin merger negotiations, the cable company said. As a result, Comcast said it was bringing its offer to Disney’s board of directors into the public eye.

"Given this (rejection), the only way for us to proceed is to make a public proposal directly to you and your Board," Comcast Chief Executive Officer Brian Roberts wrote in a letter to Eisner, made public Wednesday morning. "We have a wonderful opportunity to create a company that combines distribution and content in a way that is far stronger and more valuable than either Disney or Comcast can be standing alone."

Any such deal would create a media and distribution empire rivaling the size and influence of the post-America Online Time Warner, and would be sure to raise eyebrows across regulatory and public interest circles.

Comcast has barely finished assimilating the cable properties of AT&T Broadband, which it acquired in 2001 to become the largest cable TV company in the United States. In its proposal, it cited the recent merger between DirecTV and News Corp. as a model, saying that it would abide by the same Federal Communications Commission rules that led to the approval of that deal.

The combined company would be valued at $125 billion at closing share prices on Tuesday, and have 179,000 employees, Comcast said. It would have 21.5 million cable subscribers, and own many of the top TV brands including ABC and ESPN, all the Disney properties, and the largest high-speed Internet subscriber base in the United States.

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