The Walt Disney Company (NYSE: DIS) has announced its intention to gain full control of Hulu, a prominent streaming service, by purchasing Comcast‘s (NASDAQ: CMCSA) 33% stake in the platform for at least $8.61 billion.
This move comes as part of a “put-call” agreement between the two companies that was established in 2019. The final acquisition price will be determined through an appraisal process extending into the next year.
Comcast, which had recently redirected popular shows such as “Saturday Night Live” and “The Voice” to its Peacock streaming service, revealed in September its accelerated negotiations to sell its Hulu stake to Disney. The previous agreement allowed Comcast to compel Disney to buy its stake early next year, while Disney could also require Comcast to sell its stake.
Disney stated that acquiring Comcast’s stake in Hulu at a fair market value will contribute to its streaming goals. Hulu, with approximately 48 million subscribers, offers content from networks like ABC, FX, Fox, and original shows including “Only Murders in the Building” and “The Kardashians.”
Comcast expressed its anticipation for the appraisal process, believing “reflect the extraordinary value of the business.”
As part of Disney’s efforts to make Disney+ profitable, the company plans to integrate Hulu content into Disney+ for US subscribers, with the “one app experience” set to roll out by year-end. Hulu will continue as a standalone service, offering an ad-free option for $18 and an ad-supported version for $8.
Hulu, initially founded in 2007 as a collaborative venture of 21st Century Fox, NBCUniversal, Disney, and Time Warner, has seen ownership changes over the years, with Disney gaining control after acquiring 21st Century Fox’s assets in 2019.
Disney’s latest move reflects the broader industry trend of media companies grappling with streaming profitability and the decline of traditional television. Disney has faced investor concerns, with its shares trading at about $81, down from $197 two years ago.
In addition to the Hulu deal, Disney has explored the sale of a stake in ESPN and is evaluating divestments in assets like ABC, the Freeform cable channel, and local TV stations.
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