Disney and Comcast have reached a deal that will see the House of Mouse gain full control of Hulu. This will be done by Disney purchasing the remaining stake of Hulu that Comcast currently holds. The price tag for this sale is reportedly $8.6 billion dollars.
According to a brief statement released by The Walt Disney Company, the acquisition should be completed by the end of the year. This comes as no huge surprise to anyone who has been following the developments with Hulu. Earlier this year, Disney CEO Bob Iger shared on an earnings call that he was interested in purchasing the remaining stake in Hulu, rather than selling it.
“I’ve now had another three months to really study this carefully and figure out what is the best path for us to grow this business,” Iger said on the call. “It’s clear that a combination of the content that is on Disney+ with general entertainment is a very positive, is a very strong combination from a subscriber perspective.”
There had been some speculation that things could go a different direction as Disney continues to regain its footing after the return of Bob Iger as its CEO. Some guessed that Hulu could end up being sold instead of purchased. However, Hulu has a strong track record and Disney seemed to be leaning into it more. This includes bundling it in with the Disney+ app for those who have subscriptions for both Hulu and Disney+ in the near future.
Here is the full statement:
BURBANK, Calif., November 1, 2023—The Walt Disney Company (NYSE: DIS) announced today that it will acquire the 33% stake in Hulu, LLC held by Comcast Corp.’s (NASDAQ: CMCSA) NBC Universal (NBCU), following Comcast’s November 1 exercise of its right under the put/call arrangement between the two companies. The acquisition of Comcast’s stake in Hulu at fair market value will further Disney’s streaming objectives.
Under the terms of the put/call arrangement, by December 1, Disney expects it will pay NBCU approximately $8.61 billion, representing NBCU’s percentage of the $27.5 billion guaranteed floor value for Hulu that was set when the companies entered into their agreement in 2019 minus the anticipated outstanding capital call contributions payable by NBCU to Disney. Under the appraisal process agreed to by Disney and Comcast, Hulu’s equity fair value will be assessed as of September 30, 2023, and if the value is ultimately determined to be greater than the guaranteed floor value, Disney will pay NBCU its percentage of the difference between the equity fair value and the guaranteed floor value. While the timing of the appraisal process is uncertain, we anticipate it should be completed during the 2024 calendar year.
