Disney’s plans to buy out Comcast’s Hulu stake will cost at least $8.6 billion, but likely much more
Following up on its 2019 purchase of 21st Century Fox entertainment assets that included a two-thirds ownership position in streaming platform Hulu, Disney on Wednesday announced plans to buy up the remaining third from telecomm/media giant Comcast.
While Disney is on the hook to pay Comcast $8.61 billion thanks to a $27.5 billion guaranteed floor value for Hulu set in the 2019 deal, the company will likely pay significantly more after the conclusion of an upcoming, and tricky, valuation process.
Disney and Comcast have each hired their own firms to perform Hulu value assessments for the platform as of Sept. 30, 2023.
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According to The Wall Street Journal, Disney has retained JPMorgan for the task while Comcast has hired Morgan Stanley and, if the two sides’ valuations aren’t within 10% of each other, Comcast and Disney will bring in a third appraiser. In its Wednesday announcement of the deal, Disney said it is prepared to pay Comcast its percentage of the difference between the equity fair value and the guaranteed floor value.
Disney and Comcast have already been at loggerheads over Hulu’s value, including back in 2021 when executives at Comcast-owned NBCUniversal pegged Hulu’s value at $70 billion, with Disney’s valuation of the streaming platform coming in tens of billions below that, per The Wall Street Journal.
Hulu had just over 48 million subscribers in the third quarter of 2023, up from 22.8 million at the beginning of 2019, according to data from Statista, and Disney sees the property as a critical component of its current and future streaming objectives.
Hulu, launched in 2007, has scored a number of original programming hits over the past few years, including recent successes with series like “Only Murders in the Building” and “The Bear.” As majority owner, Disney has included Hulu access in bundled service packages along with its Disney+ and ESPN+ streaming options.
