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(Bloomberg) – And then there were two.
Hulu LLC, an online streaming company backed by leading entertainment companies, bought out AT & T Inc.'s 9.5% stake in a $ 1.43 billion deal of dollars. The agreement, which values the entire entity to $ 15 billion, leaves the company a couple of owners: Walt Disney Co., which holds majority control, and Comcast Corp.
Hulu, based in Los Angeles, was previously co-owner of Disney's quartet, 21st Century Fox Inc., Comcast and AT & T. When Disney spent $ 71 billion to acquire Fox's entertainment activities in March, he took the control of the majority. Disney's general manager, Bob Iger, said he might be interested in acquiring the rest.
This business has been designed as a way for traditional media companies to bet on the burgeoning streaming market. But it is an expensive undertaking. Hulu is expected to lose $ 1.5 billion this year, and Disney does not expect it to be profitable before the 2023 or 2024 exercises. The goal is to have between 40 and 60 million subscribers by here.
According to a Hulu spokesperson, Disney and Comcast – the remaining owners – will now have to decide how they want to account for the AT & T transaction. Both parties have time to understand how they want to allocate this stake of 9.5 %.
AT & T Debt
AT & T acquired the stake in Hulu last year when it completed another mega-process: its takeover of Time Warner Inc., for $ 85 billion. AT & T plans to use proceeds from the sale of Hulu to reduce its debt.
"We thank AT & T for their support and investments over the past two years and look forward to working together in the future," Hulu CEO Randy Freer said in his statement on Monday. "WarnerMedia will continue to be a valuable partner for Hulu for years to come, as we offer our customers the best of live and on-demand TV in one place."
Last week, Disney had stated that a price cut of Hulu, which reduced by 25% to $ 6 a month the cost of its advertising-funded entry-level version, had helped to attract more money. many customers. The company is also considering an international deployment for Hulu.
Disney's thrust into streaming includes two other products: ESPN +, which is dedicated to sports, and Disney +, a child-friendly service expected to be released in November.
(Updates with the forecasts in the fourth paragraph.)
– With the help of Rob Golum and Lucas Shaw.
To contact the reporter about this story: Nick Turner in Los Angeles at [email protected]
To contact the editor responsible for this story: Nick Turner at [email protected]
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