Instead of going to court against Disney in 2025, virtual MVPD Fubo is getting scooped up by the media giant, combining its live steaming pay TV business with that of competing vMVPD Hulu + Live TV in a standalone publicly traded company that’s 70% owned by Disney. Related to the deal, Fubo has settled all litigation against Disney - including its antitrust lawsuit against Venu Sports and JV partners Fox and Warner Bros. Discovery, which was slated for an October trial hearing.
Under the transaction, businesses of competing virtual MVPDs Fubo and Hulu + Live TV will combine in a new publicly traded entity (NewCo), under the Fubo name and stock ticker – although the two will continue to be offered as standalone live TV streaming services to consumers for now. Disney will own 70% of the combined company while Fubo shareholders will retain 30%. The new entity will be led by the existing Fubo management including co-founder and CEO David Gandler and governed by a board of directors, with the majority appointed by Disney, as well as independent directors and the CEO of Fubo.
Related to the deal Fubo settled all litigation against Disney – namely its antitrust lawsuit against the Venu Sports JV and JV partners Fox and Warner Bros. Discovery. Fubo had already scored a preliminary injunction against the launch of Venu last year and a judge had set a trial hearing start date for October. Venu had planned to debut its own skinny live sports streaming service bundle with the partners' assets, including ESPN. In ending litigation, Disney and the JV partners agreed to pay a $220 million cash settlement infusion to Fubo that isn’t contingent on the Disney-Fubo transaction closing.
In addition, Disney has committed to providing Fubo with a $145 million term loan in January 2026 that’s not contingent on the deal closing.
And notably, in connection with the deal, Fubo renegotiated carriage deals with Disney and Fox that will enable it to offer lower-cost, skinner pay TV bundles focused on sports and broadcast. Its previous inability to do so because of programmers’ alleged carriage renewal practices was one of Fubo’s primary complaints – and one that has cropped up as an industry issue – and point of contention in the vMVPD’s antitrust lawsuit against Venu.
Together, Hulu + Live TV and Fubo would have over 6.2 million subscribers in North America, contributing 4.6 million and 1.6 million, respectively.
Renegotiated carriage deals with Disney, Fox
On a call for investors Monday, Fubo’s Gandler said that despite the combination, Hulu + Live TV – which lives inside the Hulu SVOD - will maintain its focus on a broad-based entertainment offering for its streaming cable-like pay TV lineup, while Fubo remains committed to a sports-first pay TV programming approach.
Founded in 2015, Fubo now offers more than 55,000 live sports events.
The CEO noted that the last thee weeks were busy spent focused on amending agreements to allow for new programming deals, adding that those with Fox and Disney now present the vMVPD with the opportunity to offer skinnier bundles.
“We are thrilled to collaborate with Disney to create a consumer-first streaming company that combines the strengths of the Fubo and Hulu + Live TV brands,” said Gandler in a statement. “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.”
As a result of renegotiating deals with Fox and Disney, Gandler said it will be able to better compete with less expensive, skinnier, sports and news focused bundles. The new carriage agreement with Disney means Fubo will be able to launch a “Sports & Broadcast” service, featuring the media company’s networks including ABC, ESPN, ESPN2, ESPNU, SECN, ACCN, ESPNNews, as well as ESN+.
The inability to offer these types of packages and the JV partners’ alleged unwillingness to offer Fubo terms that allowed for skinnier bundles while they simultaneously worked together to launch their own sports-focused streaming bundle that combined respective linear network and other sports assets via Venu was one of the factors underpinning Fubo’s antitrust lawsuit against the JV entities.
Fubo had previously accused the JV partners of anticompetitive practices, likening them to a sports cartel. After granting a preliminary injunction that stopped Venu from launching last year, a judge set a trial hearing date for October 6, 2025. While not taking up the issue directly, the court case shed some light of the broader industry challenge related to programmers' apparent practices of forcing distributors to take and package less-watched networks and channels alongside more popular ones (sometimes referred to as tying practices), including sports, resulting in more expensive, bloated TV packages for consumers.
Instead of taking the case to court, Disney appears to instead have decided to bring Fubo into the fold in its own way. The companies said the combined entity will negotiate carriage agreements for both Fubo and Hulu + Live TV independently from Disney.
“This combination will allow both Hulu + Live TV and Fubo to enhance and expand their virtual MVPD offerings and provide consumers with even more choice and flexibility,” said Justin Warbrooke, Executive Vice President and Head of Corporate Development at The Walt Disney Company, in a statement. “We have confidence in the Fubo management team and their ability to grow the business, delivering high-quality offerings that serve subscribers with the content they want and offering great value.”
Potential synergies, international opportunity
On the call Monday, executives didn’t say that the two vMVPDs would be combining entirely, but didn’t entirely rule it out – noting the similar nature of the businesses means a lot of room for potential synergies.
Off of the bat, they indicated Fubo will benefit from Disney’s scale in securing more favorable programming deals and be able to offer flexible TV packages, offering more choice for consumers. Right now, Fubo is in the midst of a carriage dispute with Spanish-language programmer TelevisaUnvision, which saw its programming dropped from the vMVPD ahead of the New Year when the two sides weren’t able to reach renewal terms.
Disney and Fubo cited near-term synergies through sales and marketing opportunities, while Gandler also mentioned backend aspects like content delivery network (CDN) and broadcasting. They also see opportunity around the advertising business thanks to the scale that comes with Hulu + Live TV and its Disney owner.
And Fubo executives suggested that increased scale and flexibility mean the combined company can pursue growth opportunities not just domestically but internationally as well. Philosophically, Gandler said Fubo is aligned with Disney “on the importance and potential of international” but that it’s a bit too early for them to discuss that at this point.
Still, “I think we’re aligned that there’s an opportunity to take a big slice of the global pay TV market,” Gandler added.
A competitive combined entity
Together Fubo and Hulu + Live TV could present a better competitor to leading vMVPD Google’s YouTube TV, which at last disclosure in February 2024 had 8 million subscribers.
Hulu + Live TV was already the second-largest vMVPD behind YouTube TV but will count a larger subscriber base and less distance from Google’s service now with relatively smaller player Fubo in the mix.
“At deal close our company is expected to become immediately cash flow positive, instantly making Fubo a major player in the streaming space,” Fubo’s Gandler said on the call. “With over 6.2 million subscribers in North America and over $6 billion in revenue, Fubo will be well positioned to fairly compete with our peers.”
According to Fubo CFO John Janedis, by 2028 the combined entity is projected to have revenue of over $7.5 billion and a run rate adjusted EBITDA of over $550 million.
And with Hulu’s general entertainment offering continued to be offered separately alongside and in complement of Fubo’s sports-first pay TV service, Gandler said the transaction supports Fubo to further realize the aim of its so-called “super aggregation” strategy, one which included the previous launch of a free streaming tier.
Fubo execs also said the company now has better opportunity and more money so that it can focus on promotional pricing to help drive growth.
The anticipated closing date is 12-18 months out. The deal still needs to secure regulatory approvals and a greenlight from Fubo shareholders. Terms include a $130 million termination fee payable to Fubo if the transaction fails to close based on lack of regulatory approval.