Recap: Disney has announced plans to purchase Comcast's one-third stake in Hulu, the streaming service that was founded in 2007 and has had multiple shareholders over the years. Most recently, in 2019, Disney acquired 21st Century Fox which came with a 60 percent stake in Hulu.
A few months later, Hulu bought back AT&T's share of the company, leaving Disney with a 67 percent stake and Comcast with the remaining 33 percent share.
At the time, Comcast and Disney entered into a put / call agreement with a minimum guaranteed floor value of $27.5 billion for Hulu. Disney will pay fair value for Comcast's remaining stake in Hulu, an amount that will be determined based on an appraisal of value as of September 30, 2023, but is expected to be in the ballpark of $8.61 billion (which is to be paid by December 1). If the appraisal comes back higher than the floor value, Disney will pay Comcast's NBC Universal its percentage of the difference between the equity fair value and the guaranteed floor value.
Disney said it anticipates the appraisal process to be completed sometime during calendar year 2024, and that the deal will further its streaming objectives.
Share value in Disney is up 2.39 percent on the news as of this writing. Comcast is trading up 0.72 percent on the day, at $42.13 as of writing.
Disney already offers Hulu as part of the Disney Bundle, which additionally includes access to Disney+ and ESPN+ for one monthly price. Bundle plans that include access to all three services start at $14.99 per month (with ads).
The deal comes at a time when prices for streaming services continue to rise with seemingly no end in sight. Over the summer, Disney hiked rates for Disney+ and the ad-free version of Hulu. Netflix just last month confirmed it is increasing subscription prices again, and Apple last week announced higher prices for most of its streaming services (some by more than 40 percent).
Image credit: Glenn Carstens-Peters