Disney Co. picks up Pixar for $7.4 billion

LOS ANGELES — The Walt Disney Co. didn't give birth to animated characters with names such as Buzz, Woody and Nemo — so now it's adopted them for good.

In a corporate marriage that keeps Mickey Mouse and Mr. Incredible as siblings, Disney said Tuesday it was buying Pixar Animation Studios Inc. for $7.4 billion in stock.

"We have seven children together," said Pixar CEO Steve Jobs, referring to the films the companies have co-produced, from "Toy Story" in 1995 to "Cars," set for release in June. "Keeping the family together is also a really nice benefit of this relationship."

Though Disney and Pixar have cultures as different as Southern and Northern California, they already are so intertwined that splitting them would have been an ugly divorce. There were moments when it seemed that might happen.

No such worries now.

The deal could restore Disney's clout in animation while vaulting Jobs into a powerful role as the media conglomerate's largest shareholder, with roughly a 7 percent stake. Jobs, who owns more than half of Emeryville-based Pixar's shares and heads Apple Computer Inc., also will join Disney's board.

Disney has co-financed and distributed Pixar's animated films for the past 12 years, splitting the profits. That deal expires in June after Pixar delivers "Cars," and it had once appeared the companies would not renew it amid friction between Jobs and former Disney CEO Michael Eisner.

But the talks revived under Disney CEO Robert Iger, who became Disney CEO last October. Disney, the theme park owner that also owns the ABC and ESPN TV networks, and Pixar had talked for months about a new relationship.

Pixar Executive Vice President John Lasseter will become chief creative officer of the animation studios and principal creative adviser at Walt Disney Imagineering, which designs and builds the company's theme parks.

Lasseter began his career as a Disney animator and is the creative force behind Pixar's films. He will report directly to Iger.

Pixar President Ed Catmull will serve as president of the new combined Pixar and Disney animation studios, reporting to Iger and Dick Cook, chairman of The Walt Disney Studios.

The two companies will remain separate, with Pixar retaining its brand name. Maintaining Pixar's unique creative character was a priority in the talks, executives said.