In order to gain complete control of the streaming service and the ability to merge it into the Disney+ streaming service in the future, Walt Disney formally started the process of purchasing Comcast's one-third shares of Hulu on Wednesday.
Disney stated that it anticipates paying Comcast, the parent company of NBCUniversal, roughly $8.61 billion by December 1. This is the portion of the $27.5 billion assured floor value for Hulu that NBCU received when it agreed to sell Disney its ownership in the company in 2019, minus the estimated outstanding capital call payments that NBCU owes Disney.
Under the 2019 agreement, either NBCU or Disney might begin the process as early as November 1, and this schedule for the sale was accelerated from the original deadline of January 2024.
Disney, an entertainment corporation located in Burbank, California, acquired a majority stake in Hulu as part of the company's $71 billion purchase of the film and television assets of 21st Century Fox. The studio now has a competitive advantage in the battle for streaming rights thanks to the deal.
Disney CEO Bob Iger informed investors in August that the company was bringing a lot of Hulu content to bundle customers. The company is also getting closer to launching a single app in the US that will allow bundle subscribers to access content from all of Disney's other brands and Hulu's general entertainment offerings.
Speaking this autumn at a Goldman Sachs meeting, Comcast chief executive Brian Roberts referred to Hulu as a rare kingmaker asset that was much more valuable now than it was at the time of the original transaction.
By the close of Disney's third quarter, Hulu owned 48.3 million customers on Disney, while Comcast's Peacock streaming platform had 28 million paid customers at the close of Comcast's third quarter. At the conclusion of Disney's quarter, there were 146.1 million members worldwide on Disney+.
Disney finished its third quarter with over $11 billion in cash on the balance sheet.
Disney stated that the provisions of the agreement will be followed in determining Hulu's equity fair market value as of September 30, 2023. Disney shall reimburse NBCU for any change in value that is found to exceed the stipulated floor value.
According to regulatory documents, bankers for each company involved will determine Hulu's fair value.
While the exact date is unknown at this time, Disney hopes to get the appraisal process finished by 2024.