The Walt Disney Company and Comcast Corporation have come to an agreement giving The Walt Disney Company full control of streaming site Hulu.
Under the “put/call” agreement, Comcast can require Disney to buy Comcast-owned NBCUniversal’s 33% interest in Hulu while Disney can require NBCUniversal to sell said interest at its fair market value as early as 2024. The fair market value will be assessed by independent experts, but Disney has already guaranteed a sale price for Comcast with a minimum total equity value of Hulu of US$27.5 billion.
Additionally, Disney and Comcast will fund Hulu’s purchase of AT&T Inc.’s 9.5% interest in Hulu, pro rata to their current two thirds/one third ownership interests. Going forward, Comcast will have the option, but not the obligation, to fund its proportionate share of Hulu’s future capital calls, up to a maximum of $1.5 billion, but its share will be diluted if it elects not to fund.
Meanwhile, Comcast has extended its licenses for NBCUniversal content on Hulu and the Hulu Live carriage agreement for NBCUniversal channels until late 2024 and to distribute Hulu on its Xfinity X1 platform. NBCUniversal has the option to terminate most of those agreements in three years, and to exhibit certain content on its own OTT service in one year, thereby reducing the license fee payable by Hulu.
Disney’s acquisition of 21st Century Fox‘s film and television assets in March gave the entertainment giant its current 60% interest in Hulu, with remaining ownership split between Comcast and AT&T at the time.
“Hulu represents the best of television, with its incredible array of award-winning original content, rich library of popular series and movies, and live TV offerings,” said Disney chairman and CEO Bob Iger in a statement. “We are now able to completely integrate Hulu into our direct-to-consumer business and leverage the full power of The Walt Disney Company’s brands and creative engines to make the service even more compelling and a greater value for consumers.”