Comcast Expects Disney to Buy Final 33% of Hulu in 2024, but What if the Deal Doesn’t Happen?
In the minds of many customers, Hulu being a Disney property is already an established fact. After all, when Disney announced it was raising prices for its various streaming platforms, Hulu was included. That must mean that Disney owns Hulu outright, doesn’t it?
Well, not exactly. Comcast still owns a 33% stake in Hulu after Disney’s acquisition of Fox in 2019 brought the House of Mouse’s ownership stake in Hulu to 66%. Because of a deal with Comcast, Disney will have the option to buy the remaining third of the streamer from Comcast as early as January 2024.
According to reporting from CNBC, Comcast expects Disney will follow through on that option, but the price is only rising. The COVID-19 pandemic boosted the value of Hulu, and many are wondering if Disney is really willing to write the huge check it will have to if it wants to acquire the rest of streamer.
“I think if Disney could roll back the clock today, I’m not so sure they would enter into that deal,” said Neil Begley, an analyst for Moody’s Investors Services. “Disney has this huge bill to pay in 2024 at a time when they’re already investing a lot of money into Disney+.”
Comcast CEO Brian Roberts probably wouldn’t mind if Disney decided not to buy Hulu though. Roberts has been a big believer in Hulu historically, dating as far back as when he broke off talks with DIRECTV regarding a possible acquisition in 2013. Roberts was blocked from buying all of Hulu in 2019 when Fox was acquired by Disney, leading to the 66-33 split of the streaming platform, but some investors are wondering if Roberts might try to buy Hulu again if Disney balks at the price for the 33% that it doesn’t already own.
Activist investor Dan Loeb, on the other hand, is enthusiastically in favor of Disney acquiring the rest of Hulu. In a letter to CEO Bob Chapek, Loeb wrote, “It would even be prudent for Disney to pay a modest premium to accelerate the integration. We know this is a priority for (Disney) and hope there is a deal to be had before Comcast is contractually obligated to do so in about 18 months … We believe that integrating Hulu directly into the Disney+ DTC platform will provide significant cost and revenue synergies, ultimately reigniting growth in the domestic market.”
Comcast is moving ahead as if Disney will indeed be purchasing the rest of Hulu; the company is moving a all of the next-day streaming rights for NBCU shows from Hulu to its own fully owned and operated streamer Peacock by this fall. So, while Disney will have the right of first refusal, if the company decides to turn down the opportunity to purchase the final third of Hulu and focus on Disney+, expect Comcast to pounce fairly quickly.
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Hulu is a video streaming service that gives access to thousands of full seasons of exclusive series, hit movies, kids shows, and Hulu Originals like “Only Murders in the Building,” and “The Handmaid’s Tale.”