Comcast and Disney are walking down the path towards Disney buying out Comcast’s share of streaming platform Hulu.
Both Disney and Comcast own parts of Hulu, with Disney’ holding two-thirds of the streamer and Comcast holding the remaining one-third. This unusual arrangement resulted from Disney’s acquisition of Fox in 2019, which came with Fox’s one-third share of Hulu.
Comcast did not choose to sell Disney its share of Hulu back at that time because of their belief that the value of the streaming platform would grow over time. The two companies did agree in 2019 that one side would buy out the other by 2024, with Disney as the likely party to take over. As 2024 approaches, the remaining question is the value of Comcast’s shares.
Each company has enlisted the help of an investment advisor to value Comcast’s shares, with Disney hiring JPMorgan Chase and Comcast hiring Morgan Stanley. If the value determined by the two sides differs by more than 10%, the companies have agreed that a third party will step in to come up with a value.
While Hulu overall is worth $27.5 billion, determining the value of Comcast’s share is not straightforward because of the interconnections between Hulu and Disney’s other streaming platforms. Whatever amount is determined, Comcast can trigger the sale by November 1st. It has been reported that Disney CEO Bob Iger feels that Hulu’s value is greater than the cost of the acquisition, which is expected to come in at $8-10 billion.