Disney is saying Hulu to more streaming content.
Today, it was confirmed that Disney will move to acquire the 33% stake in Hulu held by Comcast following the latter’s Nov. 1 exercise of its right under the put/call arrangement between the two companies.
By Dec. 1, Disney is expected to pay NBCU approximately $8.61 billion, which represents NBCU’s percentage of the $27.5 billion guaranteed floor value for Hulu that was set when the companies entered into their agreement in 2019, minus the anticipated outstanding capital call contributions payable by NBCU to Disney.
Though the timing of the appraisal process is uncertain, the deal is anticipated to be completed during 2024.
Disney already owned two-thirds of Hulu, which has around 48 million subscribers.
The news comes from a deal Disney made with Comcast to buy its one-third stake in Hulu in 2019. The companies previously set a deadline for January for a deal, but that moved in September, with a new Disney press release now confirming things are moving ahead.
The acquisition of Comcast’s Hulu stake at fair market value is expected to help Disney further its streaming and OTT objectives. And with Disney doubling down on its streaming efforts and strategy early in 2023, a deal has been long-rumored to be coming.
In May, the company touted a combination of Disney+ and Hulu to increase its opportunity to serve digital ads and grow its advertising business. However, at the time, Disney CEO Bob Iger didn’t give a clear plan about what the future held with Comcast’s stake.
“It’s not really been fully determined what will happen in that regard, except that as we’ve looked more and more in the future of our streaming business … it’s clear that a combination of the content that is on Disney+ with general entertainment is a very strong combination,” Iger said in a May earnings call.
Elsewhere in Disney’s streaming efforts, the company announced in August that its ad-supported plan has added 3.3 million subscribers since launching in December. And according to Iger, 40% of new Disney+ subscribers are choosing an ad-supported product.
The company also cut down on its streaming losses in the most recent quarter, losing $512 million vs. $1.06 billion in the same period last year while improving its direct-to-consumer (DTC) operating income by $1 billion in three quarters, according to Iger.