Disney has announced that it is going to be merging it’s Hulu + Live TV business with Fubo, to create a combined virtual MVPD company. Under the terms of the definitive agreement, at closing, Disney will own 70% of Fubo. Fubo’s existing management team, led by Fubo Co-founder and CEO David Gandler, will operate the newly combined Fubo and Hulu + Live TV businesses.

 It should be worth noting that this only applies to the Live TV side of Hulu, not Hulu as a whole.

The deal is still subject to regulatory approvals, Fubo shareholder approval, and the satisfaction of other customary closing conditions.

Fubo Co-founder and CEO David Gandler said in a statement:

“We are thrilled to collaborate with Disney to create a consumer-first streaming company that combines the strengths of the Fubo and Hulu + Live TV brands. This combination enables us to deliver on our promise to provide consumers with greater choice and flexibility. Additionally, this agreement allows us to scale effectively, strengthens Fubo’s balance sheet and positions us for positive cash flow. It’s a win for consumers, our shareholders, and the entire streaming industry.”

Justin Warbrooke, Executive Vice President and Head of Corporate Development, at The Walt Disney Company, also said:

“This combination will allow both Hulu + Live TV and Fubo to enhance and expand their virtual MVPD offerings and provide consumers with even more choice and flexibility. We have confidence in the Fubo management team and their ability to grow the business, delivering high-quality offerings that serve subscribers with the content they want and offering great value.”

Both Fubo and Hulu + Live TV each provide customers the ability to stream a broad array of live broadcast and cable networks on their connected TVs, mobile phones, tablets, and other internet-connected devices.

Combining the businesses of Fubo and Hulu + Live TV — which together have over 6.2 million subscribers in North America — will facilitate an enhanced choice of programming packages and address a variety of consumer preferences at attractive price points.

In connection with the Transaction, Disney will enter into a new carriage agreement with Fubo that will allow Fubo to create a new Sports & Broadcast service, featuring Disney’s premier sports and broadcast networks including ABC, ESPN, ESPN2, ESPNU, SECN, ACCN, ESPNEWS, as well as ESPN+.

Fubo and Hulu + Live TV will continue to be available to consumers as separate offerings post-closing. Hulu + Live TV, will continue to be streamed in the Hulu app and be offered as part of the attractive bundle with Hulu, Disney+ and ESPN+. Fubo, which streams more than 55,000 live sporting events annually, will continue to serve its subscribers in the Fubo app.

The combined company will negotiate carriage agreements with content providers for both Hulu + Live TV and Fubo services independently from Disney.

Last year, following the announcement of the new sports streaming service, Venu Sports, Fubo took Disney, along with FOX and Warner Brothers Discovery to court to halt the launch of the new platform, which was initially set to launch last fall. With this new deal in place, that lawsuit has now been settled and is no longer an issue moving forward.

In connection therewith, at signing of the Transaction, Disney, FOX and Warner Bros. Discovery will make an aggregate cash payment to Fubo of $220 million. In addition, Disney has committed to provide a $145 million term loan to Fubo in 2026 as part of the Transaction.

Additionally, a termination fee of $130 million will be payable to Fubo under certain circumstances, including if the Transaction fails to close due to the failure to obtain requisite regulatory approvals on the terms and conditions set forth in the definitive agreement.

Roger’s Take: While I expected the lawsuit with Fubo to be settled in one way or another before it went into the discovery stages, Disney buying Fubo TV wasn’t on my bingo card.

While the initial press release states they want to keep the two platforms separate, it does open up some opportunities to fix some of the issues Disney has with Hulu + Live TV. Once the deal is complete, it wouldn’t be a huge surprise to see that Hulu + Live TV merged into Fubo, which allows the Hulu brand to continue as the general entertainment hub within Disney+. Bringing plenty of synergy and saving money on advertising and development.  It might not happen straight away, but a combined Hulu + Live TV and Fubo would be a serious competitor to YouTube TV. 

With the lawsuit now settled between Fubo and Disney, Warner Brothers Discovery and FOX, no doubt the launch of Venu Sports won’t be to far away either now. 

What do you think of Fubo and Hulu + Live TV merging?  Let me know on social media!

Roger Palmer

Roger has been a Disney fan since he was a kid and this interest has grown over the years. He has visited Disney Parks around the globe and has a vast collection of Disney movies and collectibles. He is the owner of What's On Disney Plus & DisKingdom. Email: Roger@WhatsOnDisneyPlus.com Twitter: Twitter.com/RogPalmerUK Facebook: Facebook.com/rogpalmeruk

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