Disney gains complete control of Hulu in deal worth nearly $440 million

WEB DESK: The longstanding disagreement over the valuation of Hulu’s stake has been resolved, paving the way for Disney to acquire complete ownership of the streaming platform. As part of the deal, Disney will pay nearly $439 million (€384.02 million) to Comcast’s NBCUniversal for its 33% stake, thereby gaining full control of Hulu.

This transaction concludes a lengthy appraisal process that has been ongoing for several years. In November 2023, Disney announced it was purchasing NBCUniversal’s 33% stake in Hulu for at least $8.6 billion, reflecting Hulu’s guaranteed minimum valuation of $27.5 billion, as detailed in a regulatory filing.

Since 2019, Disney has managed Hulu after Comcast stepped back from operational control and became a silent partner. Hulu was launched in 2007 and rapidly grew into a platform backed by major entertainment companies aiming to compete with the internet by providing a streaming service for their TV content. Disney joined Hulu in 2009, intending to offer shows from ABC, ESPN, and Disney Channel. A decade later, Disney solidified its majority ownership when it acquired 21st Century Fox.

In a regulatory filing on Monday, Disney noted that its appraiser initially valued Hulu below the guaranteed floor, whereas NBCUniversal’s appraiser valued it significantly above that floor. A third appraiser was brought in, concluding that Disney should pay approximately $438.7 million for NBCUniversal’s stake.

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Disney CEO Bob Iger expressed satisfaction that the matter has been resolved, stating, “We are pleased this is finally settled. We have enjoyed a productive partnership with NBCUniversal and wish them continued success.” He added that acquiring Hulu allows for deeper integration of Hulu’s general entertainment content with Disney+, as well as with ESPN’s upcoming direct-to-consumer offerings, creating a stronger value proposition for consumers.

Already, Disney+ has begun integrating Hulu’s content, and the two services are available as a bundle with ESPN+ sports streaming. The completion of this transaction is expected by July 24 and will slightly decrease Disney’s net income for the third fiscal quarter, though it is not expected to affect prior guidance for fiscal 2025 adjusted earnings. Following the news, Disney’s shares rose approximately 1% in Tuesday morning trading.