The Bid's Dead, But Don't Say Adieu Yet
By Marc Gunther

(FORTUNE Magazine) – Although Comcast has dropped its $54 billion takeover bid for Disney, these two media giants are far from done with each other. The man to watch as this story unfolds is Stephen Burke, the 45-year-old president of Comcast Cable who used to work at Disney. Burke is on the directors' short list of candidates to succeed Michael Eisner, Disney's besieged CEO.

As long as Comcast had a hostile bid for Disney on the table, Burke could not be seriously considered for a top job at the Mouse House. Now he can be.

The question is, do Disney's directors have any interest in replacing Eisner? After two days of intense discussions about the company's future in late April, they emerged to declare they had "complete confidence in Michael Eisner, Bob Iger, and the senior management team."

Fair enough. But under pressure from dissident shareholders, the directors are also getting serious about succession. They're looking hard at inside candidates as well as ex--Disney executives who now work elsewhere, among them eBay CEO Meg Whitman, Gap CEO Paul Pressler, and Burke.

Burke has an impressive track record. In 12 years at Disney, he helped develop the Disney stores, became president of Euro Disney, and then ran ABC's TV and radio stations. At Comcast he oversees the core cable business, which has grown from seven million to 21 million subscribers since he joined the Philadelphia-based firm six years ago. His pedigree could not be better--his father, Dan Burke, had a stellar career at Capital Cities/ABC, and his uncle, James Burke, was the widely admired CEO of Johnson & Johnson. Burke says he loves Comcast, but he may not want to spend the rest of his career as No. 2 to Brian Roberts, the chairman and CEO, who is only 44 and son of the company's founder. He was slated to run Disney if Comcast's takeover bid had succeeded.

Burke said last week that the Comcast-Disney deal is dead. For now, Comcast will consider a bid for bankrupt Adelphia and its 5.5 million cable subscribers. (Time Warner, parent of FORTUNE's publisher, and Cox Communications will also kick the tires at Adelphia.) But imagine, for a moment, that Burke does replace Eisner when his contract expires in the fall of 2006, if not sooner. You can be certain that it would not be long before he and Brian Roberts begin to talk about merging. As we said, this deal isn't dead yet. --Marc Gunther