On Tuesday, the 14th of May 2019, at late US trading hours, Walt Disney Co., the long-cherished American entertainment conglomerate, headquartered in Burbank, California, had issued a statement saying that the company would be taking complete control of Hulu services, an over-the-top TV streaming media, at a deal with Comcast Corp., as Disney had still been seeking a bigger bite out of the global streaming market, unparallelly dominated by Netflix Inc.
so far. According to the agreement, minimum equity value of Hulu resides at $27.5 billion, which would likely to allow the company to trigger a sale of Comcast’s 33 percent of stake to Disney, and the deal might not be sealed before January 2024.
Nevertheless, Comcast had also agreed to finance Hulu’s recent acquisition of AT&T’s 9.5 percent interest, which would eventually be sold to Disney as well following the completion of the deal, could be reached as early as January 2024, as beforementioned.
Departure of Comcast from Hulu’s board would allow Disney to better prepare Hulu to expand into the domestic alongside international markets in order to battle with the streaming media giants, likes of Netflix Inc, Apple Inc.
and Amazon.com Inc. Adding that the Disney move to achieve entire control over Hulu’s content would be dynamic, a managing partner of Memphis-based hedge fund Gullane Capital Partners, Trip Miller said, “It is important for Disney to have full control of the direction and content on Hulu.
Postponing the closing five years (later) allows Disney to not take on more debt after just closing (its purchase of) Fox, while giving Comcast an option to the upside if/when the Hulu valuation grows during this time”.
In point of fact, Disney has been preparing to launch its own streaming service, named Disney+, by November 12th.