A press release announcing the decision by 21st Century Fox, NBC Universal and the Walt Disney Company, was issued 7/12 after a bid that reportedly topped $1 billion from DirecTV; one over $900 million from Former News Corp. President Peter Chernin and AT&T. This was the second time the company was put up for bids. Chernin bid $500M in April.
“Hulu has emerged as one of the most consumer friendly, technologically innovative viewing platforms in the digital era. As its evolution continues, Disney and its partners are committing resources to enable Hulu to achieve its maximum potential,” said Robert Iger, chairman and CEO of Disney.
In addition to pulling Hulu off the market, NBCU and Disney jointly announced they will maintain their respective ownership positions in Hulu and together provide a cash infusion of $750 million in order to propel future growth.
Launched in 2008, Hulu is now a leading aggregator of premium online television content from over 400 content partners, and has achieved more than 30 million monthly unique visitors.
“We believe the best path forward for Hulu is a meaningful recapitalization that will further accelerate its growth under the current ownership structure,” said Chase Carey, President and COO of 21st Century Fox. “We had meaningful conversations with a number of potential partners and buyers, each with impressive plans and offers to match, but with 21st Century Fox and Disney fully aligned in our collective vision and goals for the business, we decided to continue to empower the Hulu team, in this fashion, to continue the incredible momentum they’ve built over the last few years.”
Hulu launched its premium subscription service, Hulu Plus, in 2010, which has now surpassed four million subscribers after more than doubling in 2012. Hulu achieved record revenues of $690 million that same year.
RBR-TVBR observation: Valuations for online media properties are always a bit of a moving target. While a lot of folks thought Hulu would be buried by competition from the likes of Netflix and YouTube, the company is holding its own—and its value. It would be kind of silly for these content producers to dump something that’s a proven online and mobile runway. Perhaps when they saw just how valuable it really has become in the marketplace the collective light bulb went off not to sell it.