Yahoo approaches Hulu about possible acquisition [Updated]
Yahoo Inc. recently approached Hulu to discuss a possible acquisition of the popular online video service, according to a person with knowledge of the matter.
Hulu, which streams television shows on the Internet, has been the subject of intense speculation about its future. The company, whose owners include media giants News Corp., Walt Disney Co. and Comcast Corp., has been struggling to find a balance between the desires of consumers to watch shows free online and its owners' interest in protecting the value of their programming. Late last year, it launched a paid subscription service to complement its free offerings.
Although there has been interest in the company, it remains unclear whether its owners have any desire to sell. Hulu has not taken any traditional steps associated with a sale such as retaining an investment bank to field offers. However, it is currently undergoing a restructuring that would give Chief Executive Jason Kilar and his executive team greater autonomy while imposing new rules on the availability of television content.
[Update, June 22, 1:46 p.m.: Hulu has put itself up for sale and retained two investment banks.]
On Tuesday afternoon, word of the unsolicited offer spread and was subsequently confirmed by people close to the company. It is not known whether the offer came from Yahoo or another entity. Spokespersons for Yahoo, Hulu, News Corp. and Comcast declined to comment. A spokeswoman for Disney did not immediately respond to a request for comment.
Hulu's board of directors has not met to consider any offers, a person close to the board said. The Santa Monica company's board includes executives from News Corp., Disney and Providence Equity.
Comcast, which acquired its stake when it took control of NBC Universal, has no say in the operations of the company. It forfeited NBCUniversal's Hulu board seats and role in management as part of the conditions of government approval of Comcast's acquisition of the entertainment company.
An earlier attempt for Hulu to become an independent, publicly traded company was quashed because the service didn't have long-term rights to stream the broadcast TV shows that have attracted 27 million monthly viewers to the site. Any potential buyer would probably want to secure a long-term commitment to content from the current owners.
The Wall Street Journal first reported on the unsolicited offer.
-- Dawn C. Chmielewski and Ben Fritz
Photo: Hulu CEO Jason Kilar. Credit: Gary Friedman / Los Angeles Times