Disney’s Hulu + Live TV and sports streaming service Fubo are joining forces in a deal that will also result in the resolution of a legal dispute related to the creation of Venu Sports.
Both Fubo and Hulu + Live TV offer users the ability to watch live broadcasts and cable networks on various devices such as connected TVs, smartphones, tablets, and other internet-enabled gadgets.
The merged entity, in which Disney will hold a 70% interest, will function under the name of Fubo’s publicly traded company and will be managed by Fubo’s current leadership team. Together, Fubo and Hulu + Live TV boast a total of 6.2 million subscribers in North America.
The Walt Disney Co. logo appears on a screen above the floor of the New York Stock Exchange, Aug. 8, 2017.
AP Photo/Richard Drew, File
Fubo and Hulu + Live TV will still be available to consumers as separate offerings once the transaction closes.
“This combination enables us to deliver on our promise to provide consumers with greater choice and flexibility,” Fubo CEO David Gandler said in a statement. “Additionally, this agreement allows us to scale effectively, strengthens Fubo’s balance sheet and positions us for positive cash flow.”
Disney has committed to a $145 million term loan to Fubo in 2026. There’s also a $130 million termination fee payable to Fubo under certain circumstances.
Disney said it will also enter into a new deal with Fubo that will allow Fubo to create a new sports and broadcast service that features Disney’s sports and broadcast networks including ABC, ESPN, ESPN2, ESPNU, SECN, ACCN, ESPNEWS and ESPN+.
The companies said that Fubo has settled all litigation with Disney and ESPN related to Venu Sports, the sports streaming platform that was planned by ESPN, Fox and Warner Bros. Discovery. Fubo has also settled all litigation with Fox and Warner Bros. Discovery.
In August a federal judge granted Fubo’s motion for a preliminary injunction against Venu Sports. Last month the same judge dismissed Venu’s motion to dismiss the lawsuit.
Disney, Fox and Warner Bros. Discovery will make a $220 million payment to Fubo.
Shares of Fubotv Inc. more than tripled in afternoon trading Monday, while Disney’s stock rose slightly.
Disney is the parent company of this ABC station.
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