Disney takes full control of Hulu

Carla Harmon
May 14, 2019

Disney has guaranteed a sale price for Comcast that represents a minimum total equity value for Hulu of $27.5 billion.

Comcast has also agreed with Hulu to extend the Hulu license of NBCUniversal content and the Hulu Live carriage agreement for its channels until late 2024 as well as distribute Hulu on its Xfinity X1 platform.

"It is important for Disney to have full control of the direction and content on Hulu", said Trip Miller, managing partner of Memphis-based hedge fund Gullane Capital Partners, whose funds include Disney shares. Read about the Disney Hulu ownership deal below. After completing its acquisition of 20th Century Fox earlier this year, the Mouse House has now assumed full operational control of the streaming service Hulu, effective immediately. In April, AT&T/Warner Media reached a deal to sell its 10% stake in Hulu back to the streaming company. Within five years, Comcast has agreed to sell its Hulu stake to Disney for at least $9.2 billion.

Under their pact, Comcast's NBCUniversal will retain its 33% ownership interest in Hulu but as early as January 2024, Comcast can require Disney to buy NBCU's interest in Hulu. Don't expect Hulu to suddenly be stripped for parts by Disney though as the streaming service has value on its own.

Disney CEO Bob Iger said in a media call Tuesday that the deal gives the company the ability to bundle its streaming services easily, meaning consumers can buy one, two or all three of its platforms. Now the company, known as WarnerMedia, is launching its own streaming service this year, which will focus on HBO and other shows and movies owned by the company. It can, however, switch any exclusive deals to non-exclusive within one year, and can cancel most of its content-licensing agreements with Hulu by 2022. Many of those are licensed to Hulu from NBCUniversal.

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