Walt Disney Company confirms $8.6bn deal for full Hulu ownership

The Walt Disney Company (NYSE: DIS) has made a strategic move in the streaming industry, announcing its plans to acquire the remaining 33% stake in Hulu, LLC, currently held by Comcast Corp.’s (NASDAQ: CMCSA) NBC Universal (NBCU). This decision follows Comcast’s exercise of its put/call option on November 1, setting the stage for a significant shift in the streaming service landscape.

Details of the Acquisition Deal

According to the terms discussed, Disney is set to pay approximately $8.61 billion to NBCU by December 1. This figure is part of a prearranged agreement, with the $27.5 billion guaranteed floor value for Hulu established back in 2019 when the companies first entered their partnership. The deal also includes a stipulation that if the fair market value of Hulu, assessed as of September 30, 2023, exceeds the guaranteed floor value, Disney will be required to pay NBCU the difference.

Hulu’s Strategic Value to Disney

Hulu, a prominent American subscription streaming service, has been primarily under Disney’s control, with Comcast retaining a minority stake until now. The acquisition of Comcast’s share in Hulu signifies Disney’s commitment to expanding its streaming objectives and consolidating its leadership in the digital entertainment industry. While the exact timing for completing the appraisal process is uncertain, the transaction is expected to finalize during the 2024 calendar year, marking a new chapter in the streaming service’s history and Disney’s broader media strategy.