The Walt Disney Company has announced a major deal to combine its Hulu + Live TV service with FuboTV Inc., establishing a new virtual multi-channel video programming distributor (MVPD). The transaction, still awaiting regulatory approval and shareholder consent, will make Disney the primary stakeholder in the newly formed company.
Overview of the Agreement
As part of the deal, Disney will own 70% of the combined entity after the mergerâs completion. Fuboâs current management, led by CEO and Co-founder David Gandler, will continue to run the merged businesses, overseeing both Fubo and Hulu + Live TV operations.
Leadership Remarks
David Gandler expressed excitement over the partnership, saying, âWeâre excited to work with Disney to create a consumer-centric streaming company, uniting the strengths of both Fubo and Hulu + Live TV. This merger will empower us to offer consumers more options and flexibility.â
Justin Warbrooke, Disneyâs Executive Vice President of Corporate Development, commented, âThe combination will allow Hulu + Live TV and Fubo to strengthen and diversify their virtual MVPD offerings, giving consumers even more flexibility and choice.â
Broader Consumer Options Post-Merger
Both Fubo and Hulu + Live TV are known for providing a diverse selection of live broadcast and cable networks to their subscribers, accessible across connected devices such as smart TVs, smartphones, tablets, and more. Together, the two services boast over 6.2 million subscribers in North America, enhancing the variety of programming options and meeting various consumer preferences.
As part of the agreement, Disney will partner with Fubo to introduce a new Sports & Broadcast service. This service will showcase Disneyâs premier sports and broadcast networks, such as ABC, ESPN, ESPN2, ESPNU, SECN, ACCN, ESPNEWS, and ESPN+.
Post-merger, both Hulu + Live TV and Fubo will remain available as distinct offerings. Hulu + Live TV will continue to be accessible through the Hulu app and remain part of a broader bundle with Hulu, Disney+, and ESPN+. Fubo will maintain its presence in the Fubo app, known for streaming over 55,000 live sports events annually.
Synergy and Growth Potential for the Combined Entity
Following the merger, the new company will be governed by a board of directors, with Disney appointing the majority of the members, alongside independent directors. Fubo CEO David Gandler will also be part of the board. The merger will generate synergies, including flexible programming options, innovation, and expanded sales and marketing efforts.
The combined company is expected to be financially strong and profitable from the outset.
Financial Details and Legal Settlements
As part of the merger, Fubo has settled all ongoing legal disputes with Disney and ESPN related to the Venu Sports platformâa project initially planned by ESPN, FOX, and Warner Bros. Discovery. Fubo has also resolved all lawsuits with FOX and Warner Bros. Discovery.
At the time of finalizing the transaction, Disney, FOX, and Warner Bros. Discovery will collectively pay Fubo a sum of $220 million in cash. Furthermore, Disney has committed to providing Fubo with a term loan of $145 million, which is set to mature in 2026.
If the transaction does not proceed due to regulatory hold-ups, Fubo will be entitled to a termination fee of $130 million.
A Strategic Move
This merger represents a strategic move for both companies, combining their assets to offer consumers greater flexibility, more programming options, and improved access to live TV and sports content.
