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Comcast ‘more likely than not’ to sell Hulu stake to Disney next year, CEO says


The Hulu ownership saga between Walt Disney Co. and Comcast Corp. looks ever more likely to end with the most logical conclusion.

A week after Disney
DIS,
-1.78%

Chief Executive Bob Iger showed a renewed appreciation for general entertainment content and said that the company would integrate Hulu content into the Disney+ app for joint subscribers, Comcast
CMCSA,
-0.90%

Chief Executive Brian Roberts said it was quite probable Comcast would end up selling its one-third stake in the service early next year.

It’s “more likely than not” that the companies will go through with “what we’ve said all along,” Roberts said at an SVB MoffettNathanson conference Tuesday. In the “vast majority” of cases, he said, he sees Disney opting to buy out Comcast’s stake in accordance with their put/call agreement. In this case, Disney would gain full ownership of the service.

“One thing I just want to say is part of the calculus of why I think that is probably the case is I think Disney recognizes, as anybody else would recognize, that Hulu is really valuable,” Roberts said. “If you think about what happens in that put/call, it’s what would a willing buyer in a robust auction pay.”

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With Hulu, Disney would get a streaming service with 50 million to 55 million-plus domestic subscribers, he added.

Roberts said it was “no surprise” that Iger and Disney are “now back interested in general entertainment.”

Disney, which currently owns two-thirds of Hulu, and Comcast agreed in 2019 that Disney would have the option to buy out Comcast’s stake as early as January 2024. The companies agreed that Hulu’s fair-market value would be assessed by third-party experts but that Disney “has guaranteed a sale price for Comcast that represents a minimum total equity value of Hulu at that time of $27.5 billion,” according to a 2019 release.

Roberts said Tuesday that Comcast has “a very valuable position” and that a sale of Hulu would “be good for our shareholders,” while an alternative outcome would also be beneficial.

Iger’s commentary last week marked a change in tone from February, when he said that “everything’s on the table” as far as Hulu’s ownership was concerned, meaning he wasn’t opposed at the time to selling Disney’s position.



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