Fox, NBCUniversal, Disney abort Hulu sale; Owners to Infuse US$ 750-M to Grow Company

New York, NY, July 12, 2013 — In a sudden twist of events, 21st Century Fox, NBCUniversal and The Walt Disney Co. stopped the bidding of Hulu and jointly announced that they will maintain their respective ownership positions in the video company. In a statement, the owners said they agreed to provide cash infusion of $750 million to propel future growth.

“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 Chief Operating Officer 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."

The owners had been exploring a sale for the past several months, accepting offers from as many as seven different companies. But as the July 5 deadline for bidding neared, three top pay-TV companies emerged as remaining serious contenders.

The largest satellite company in the U.S., DirecTV, made a bid for the online video service, while Time Warner Cable offered to acquire a stake. AT&T, which operates the U-verse pay TV-service, also submitted a joint bid with Chernin Group, producer of "Rise of the Planet of the Apes" film and TV's "New Girl" as well as an investor in startups such as Tumblr and Flipboard.

Although the terms of the pay-TV companies’ offers have not been disclosed, Hulu owners were  reportedly expecting a bid of about $1 billion, which is much lower than the $2 billion they would have expected to fetch had they sold the company two years ago.

Sources say the DirecTV earlier enjoyed an upper hand by bidding aggressively but that the withdrawal was a "strategic decision." It is the second time Hulu's owners have attempted to sell the company only to pull back.

“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 A. Iger, Chairman and CEO, The Walt Disney Company.

Hulu is an online video subscription service that offering ad-supported on-demand streaming video of TV shows, movies, webisodes and other new media, trailers, clips, and behind-the-scenes footage from NBC, Fox, ABC, TBS, and many other networks and studios.

Launched in 2008, Hulu has grown to become a leading aggregator of premium online television content from over 400 content partners, and has achieved more than 30 million monthly unique visitors.

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.

Reports say many of the bidders reportedly balked at the terms of the deal, as the owners placed what one dubbed "onerous" demands with regard to content as owners of TV networks like NBC, ABC and Fox as well as a litany of cable channels, wanted the rights to hold back certain shows from Hulu.