Fubo has agreed to end court action over the launch of Venu Sports, the streaming venture bringing together The Walt Disney Company, FOX Corp. and Warner Bros. Discovery.
Instead the company has agreed to accept a $220 million settlement and help with the build out of the Venu product that had been on hold since Fubo won a preliminary injunction in August.
The combination will create the second-biggest internet pay-TV company in North America, after YouTube TV. It would be home to 6.2 million subscribers.
Disney’s US pay-TV business, known as Hulu with Live TV, will merge with Fubo to create a new company in which Disney will hold 70%. Fubo will remain a publicly traded company and will hold 30% in the new venture. Disney will also fund a $145 million term loan paid next year.
Fubo CEO David Gandler will become CEO of the new company, weeks after warning that Fubo would been forced into bankruptcy by the plan that would allow sports fans to take individual sports channels without the buy-through of smaller multichannel services.
Today he told investors: “This combination enables us to deliver on our promise to provide consumers with greater choice and flexibility. Additionally, this agreement allows us to scale effectively, strengthens Fubo’s balance sheet and positions us for positive cash flow. It’s a win for consumers, our shareholders, and the entire streaming industry.”
Disney will enter into a new carriage agreement with Fubo that will allow Fubo to create a new Sports & Broadcast service, effectively what was enviaged as Venu, and featuring Disney’s premier sports and broadcast networks including ABC, ESPN, ESPN2, ESPNU, SECN, ACCN, ESPNEWS, as well as ESPN+.
Fubo and Hulu + Live TV will continue to be available to consumers as separate offerings post-closing. Hulu + Live TV, a leader in entertainment programming, will continue to be streamed in the Hulu app and be offered as part of the attractive bundle with Hulu, Disney+ and ESPN+. Fubo, which streams more than 55,000 live sporting events annually, will continue to serve its subscribers in the Fubo app.
The combined company will negotiate carriage agreements with content providers for both Hulu + Live TV and Fubo services independently from Disney.
Fubo is also the owner of French pay-TV platform Molotov.
