The Walt Disney Company has said that it will acquire Comcast Corporation-owned NBC Universal’s (NBCU) 33% stake in streaming platform Hulu for $8.61 billion at a valuation of $27.5 billion. Disney hopes to complete the transaction by December 1.
Walt Disney said the acquisition of Comcast’s stake in Hulu at fair market value will further Disney’s streaming objectives. The announcement follows Comcast’s November 1 exercise of its right under the put/call arrangement between the two companies.
The two companies had set $27.5 billion as the guaranteed floor value for Hulu in 2019, minus the anticipated outstanding capital call contributions payable by NBCU to Disney.
Speaking at the Goldman Sachs Communacopia + Technology investor conference, Comcast CEO Brian Roberts stated that Hulu might be worth $30 billion given all the synergies.
Under the appraisal process agreed to by Disney and Comcast, Hulu’s equity fair value was to be assessed by 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.
As of April 1, 2023, Hulu had 48.2 million subscribers.
Hulu is a subscription-based DTC service with general entertainment content from the company’s various studios as well as content licensed from third parties. Hulu’s revenue is primarily derived from subscription fees and advertising sales.
Hulu offers SVOD services with or without advertising in addition to a digital OTT MVPD (live TV) service that is available with either of Hulu’s SVOD services and, since December 2021, includes the Disney+ and ESPN+ DTC services.
Hulu’s Live TV service includes live linear streams from cable networks and the major broadcast networks. In addition, Hulu offers subscriptions to premium services such as HBOMax, Cinemax, Starz, and Showtime, which can be added to the Hulu service.
