AT&T has sold its 9.5% stake in OTT video service provider Hulu for $1.43 billion.
The companies said the transaction values Hulu, which is majority owned by Disney, at $15 billion. They noted that the deal didn't require governmental or other third-party approvals, so it was simultaneously signed and closed.
The deal gives Disney even more control of Hulu, the company behind an SVoD and live TV streaming service with about 25 million subs combined. Disney, which will get deeper into the direct-to-consumer OTT game when it launches Disney+ on November 12, secured 60% of Hulu following the 21st Century Fox deal.
The AT&T sell-off to the Hulu joint venture could spark more speculation on whether Comcast/NBCU will also look to unload their 30% stake in Hulu.
AT&T, meanwhile, said it will use the proceeds from the divestiture, along with other planned sales of "non-core assets," to reduce its debt. The Hulu stake sale also arrives as AT&T's WarnerMedia unit prepares to launch a set of subscription-based, OTT-delivered VoD video services.
- AT&T Sells Stake in Hulu
- As Hulu Live Tops 1M Subs, Who Leads the OTT-TV Race?
- Disney+ to Debut November 12, Fetch $6.99 Per Month
- Disney's Direct-to-Consumer Effort Isn't Coming Cheap
- Disney Seals Fox Deal
- Analyst: AT&T Made 'Major Strategic Error' on SVoD Plan
— Jeff Baumgartner, Senior Editor, Light Reading