Comcast Collects $8.6 Billion Check from Disney for Hulu, Could Get Even More
Hulu’s final valuation still hasn’t been determined, but Comcast got a pretty big down payment on Friday.
A story that has dominated headlines for much of the past year is inching its way toward a conclusion. The saga of Hulu, the streaming service once owned equally by Disney, Fox, and Comcast is about to fall under a single company’s control for the first time in its history.
- Disney has officially sent an $8.61 billion check to Comcast in return for its 33% stake in Hulu.
- The sale is not final, and Disney may have to pay more if impendent bankers value Hulu more highly.
- Disney is gearing up to launch a one-app version of Disney+ and Hulu this month.
Disney Pays Up
When Disney acquired most of Fox’s media assets in 2019, it became the majority owner of Hulu. At that time, it also agreed to a plan where it could purchase Comcast’s outstanding 33% share in the streamer starting in 2024; conversely, Comcast could also have forced Disney to make the purchase as well. The sides agreed to a minimum valuation for the platform at $27.5 billion, meaning that the remaining third would be valued at just over $9 billion, minus fees.
One-third of that price came to $8.61 billion after Comcast sent capital call contributions Disney’s way. That’s the minimum valuation both sides knew they’d be walking into negotiations with, and they decided to move up negotiations from January 2024 to fall of this year to have done with the proceedings once and for all.
Those negotiations soon soured, and the two sides quickly concluded they would not be able to agree on a valuation for Hulu if left to their own devices. Instead, the companies decided that Disney would pay at least $8.61 billion by Dec. 1, and that each would bring in an independent banking firm to come up with their own valuations of Hulu. If those two valuations are too far apart, a third banker will be brought in to make the final say.
That means Disney could end up paying far more for Hulu than the initial $8.6 billion down payment. Some Wall Street analysts pegged Hulu's value at as much as $45 billion this fall, so there’s certainly no guarantee that Disney is done paying for the streaming platform even after writing a check with an eye-popping amount of zeroes.
What’s Next for Hulu?
Now that Hulu is coming completely under Disney’s control officially, it can move ahead with plans to more fully integrate it with Disney+. A beta version of Disney+ and Hulu together on a single app is launching this month, with a full version complete with all the features intended for the platform scheduled to follow in early 2024.
It’s almost certain that the sale’s completion will be followed by Hulu’s international launch as well. With 48 million domestic subscribers, Hulu manages to hold its own, but Disney has held it back from international markets for fear of increasing the streamer’s valuation and jacking up the price of Comcast’s stake. Since that’s no longer a consideration, a worldwide launch of Hulu can be expected as soon as Disney can put the infrastructure in place.
Hulu
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.”