Disney Wins Hulu Negotiations With Comcast; Closes Deal For Only $438.7 Million
The long and winding debate between Disney and Comcast over the valuation of Hulu has finally come to an end.
As a brief recap, Disney moved to acquire Comcast’s remaining stake in Hulu in 2023, securing full ownership of the streaming platform. Prior to that, a 2019 agreement had left Disney with 66% ownership, while Comcast retained the remaining one-third.
Photo: Hulu
Under the 2019 agreement, Disney had the option to buy out Comcast’s stake in the streamer. When they chose to do so, the question then became how much that stake was worth.
The Two Sides Had Radically Different Valuations
Per the agreement, Hulu’s valuation couldn’t fall below $27.5 billion, making Comcast’s share worth approximately $8.6 billion. However, the company maintained that Hulu’s actual value was even higher.
Photo: Disney
To determine a fair valuation, Disney and Comcast each enlisted a separate financial institution. JPMorgan assessed Hulu’s value at $27.5 billion on Disney’s behalf, while Morgan Stanley estimated a significantly higher value of $40 billion for Comcast.
The discrepancy came from how both companies defined Hulu’s value. Disney argued that the final calculation should be based on the streaming service’s revenue, expenses, and margins.
On the other hand, Comcast has long argued that the streamer should be valued at the price it would fetch on the open market.
Comcast CEO Brian Roberts Photo: Variety
In December 2023, Disney paid Comcast the $8.61 billion that it minimally owed for the purchase of Hulu. The lingering question was how much more they owed.
Disney Only Paid an Additional $438.7 Million
We finally got the answer to that question today, when Disney paid Comcast an additional $438.7 million.
With this final payment, Disney will have paid Hulu roughly $9 billion, meaning Hulu was ultimately valued at $27 billion. Had Comcast’s valuation been correct, Disney would have owed an additional $5 billion for Hulu.
Image Credit: Disney
“We are pleased this is finally resolved. We have had a productive partnership with NBCUniversal, and we wish them the best of luck,” Disney CEO Bob Iger said in a statement.
Photo: Deadline
“Completing the Hulu acquisition paves the way for a deeper and more seamless integration of Hulu’s general entertainment content with Disney+ and, soon, with ESPN’s direct-to-consumer product, providing an unrivaled value proposition for consumers.”
The End of the Story
For their part, Comcast was gracious in defeat.
“Hulu was a great start for us in streaming that generated nearly $10 billion in proceeds for Comcast and created an important audience for NBCUniversal’s world-class content. We wish Disney well with Hulu and appreciate the cooperative way our teams managed the partnership,” a Comcast spokesman said.
Photo: Deadline
Now that the final payment has been made, Disney fully owns Hulu, and the company’s financial future has become clearer.
It is a great day to be Bob Iger.
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