Hulu.com owners Walt Disney Co. (DIS), Comcast Corp. (CMCSA) and News Corp. (NWSA) are close to buying out Providence Equity Partners Inc.’s stake at a price that values the company at $2 billion, said two people with knowledge of the matter.
Providence is selling its 10 percent share in Hulu for $200 million after investing $100 million when the venture began in 2007, according to the people, who weren’t authorized to talk publicly.
The companies will also allow employees of Los Angeles- based Hulu, including Chief Executive Officer Jason Kilar, to sell some shares of the closely held online TV service, the people said. This month, Hulu said its $8-a-month Hulu Plus service, which allows users to watch an expanded library of shows on video-game consoles and mobile devices, had more than 2 million subscribers.
Elisa Schreiber, a Hulu spokeswoman, declined to comment, as did Andrew Cole, an outside spokesman for the Providence, Rhode Island-based private equity group.
The owners canceled a sale last year after previously putting off plans for an initial public offering. Exclusive programs will help the service compete with Netflix Inc. (NFLX), the online and mail-order film and TV subscription service.
Hulu LLC is building a roster of original programs to persuade advertisers to make bigger commitments and attract new ones. The site is offering ad buyers the ability to target viewers by demographics, geography and by viewing device. Earlier this week Hulu said advertisers would only pay for ads that had been viewed start to finish.
The service announced four new original series this month in meetings with advertisers.
“We Got Next” and “The Awesomes,” an animated series by “Saturday Night Live” member Seth Meyers, will start this year and in 2013, Hulu said. Airdates for “Don’t Quit Your Daydream,” from “Entourage” star Adrian Grenier, and “Flow” weren’t provided.
Hulu plans to spend $500 million on TV shows and films in 2012, Kilar wrote Jan. 12 on the company’s website. That’s up from $300 million projected a year ago, according to an April 2011 post.
By Andy Fixmer and Cristina Alesci
Courtesy of Bloomberg News