Comcast and Disney have modified their Hulu agreement to enable the expected buyout of Comcast’s one-third stake in the streamer to begin on September 30 instead of next January. The news was shared at a Goldman Sachs conference appearance by Comcast CEO Brian Roberts, who said the initial minimum valuation of $27.5 billion for Hulu agreed to in 2019 was “just a hypothetical.” He suggested the final price tag could be much higher. Roberts said both companies “wanted to get this behind us,” so they reached an agreement last week to accelerate the timeline.
On September 30, Disney can “put” and Comcast can “call,” which starts the process of the one-third stake moving to Disney. Each company will have its own appraiser and then there will be third-party appraisers, so the process could take some time. Roberts said both companies “are well-served to have clarity for investors about what this really means,” so it shouldn’t drag on too long. The put/call provision was part of the 2019 operational takeover of Hulu by Disney in 2019 in the wake of the $71.3 billion acquisition of most of 21st Century Fox. Founded in 2007, Hulu was always a joint venture, in its later years among Fox, Disney and Comcast/NBCUniversal. While Disney and Comcast have publicly floated the scenario of Comcast buying out Disney’s share, the process has followed the more widely expected path of Disney rolling up full control.
Roberts emphasized that the $27.5 billion minimum valuation “that people have bandied about was just a hypothetical” and will likely to end up far higher. Hulu is “a scarce, kingmaker asset,” he asserted, and worth “way more today than it was” when the parties agreed to the five-year timeline. “Netflix and Hulu are in a class by themselves” as stand-alone streaming outlets, Roberts said. Citing Nielsen data, he said engagement on Hulu is “two to three times” that of rival streamers except for Netflix.
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