Disney is buying up Comcast’s stake in Hulu. The entertainment giant announced Wednesday that it “expects it will pay” $8.61 billion to acquire Comcast’s 33 percent stake, giving Disney full ownership of Hulu.
But Disney might end up paying more than that. Both Disney and Comcast agreed to an appraisal process that will evaluate Hulu’s equity fair value as of September 30th. If Comcast’s stake is determined “to be greater than the guaranteed floor value,” Disney will have to pay Comcast the difference.
Disney says the timing of the appraisal process is “uncertain,” but it expects it to be completed sometime next year. This all stems from the deal Disney made with Comcast to buy its one-third stake in Hulu in 2019. The deal was initially set to take place in 2024, but Comcast and Disney agreed to move the date to September 30th.
At the time, the two companies agreed upon a minimum valuation of $27.5 billion for Hulu. “That was just a hypothetical that we picked five years ago,” said Comcast CEO Brian Roberts during an investors conference in September. “The company is way more valuable today than it was then.”
With Hulu barely seeing a shift in subscribers last quarter, Disney announced a price hike across all of its streaming services and hinted at a password-sharing crackdown. In October, Hulu’s ad-free service went from $14.99 / month to $17.99 / month, while Hulu with Live TV will jump from $68.99 / month to $75.99 / month. We’ll likely hear more about Disney’s plans for Hulu during the company’s earnings call next week.
Disclosure: Comcast’s NBCU division is a minority investor in Vox Media, The Verge’s parent company.