Hulu buys back AT&T’s stake in $1.43 bln deal

The move gives Walt Disney Co, which holds a 60 percent stake in Hulu via a joint venture, more control of the company. (AP)
Updated 16 April 2019
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Hulu buys back AT&T’s stake in $1.43 bln deal

  • The deal implies Hulu’s total value is some $15 billion
  • Disney and Comcast will decide on how they want to allocate the shares bought from AT&T

Hulu is buying back wireless carrier AT&T Inc’s 9.5 percent stake in the US entertainment streaming service in a deal valued at $1.43 billion, the two companies said on Monday.
Hulu, which competes with Netflix Inc. and Amazon.com’s Prime Video, has more than 25 million subscribers and is expected to lose $1.5 billion in the current fiscal year.
The deal implies Hulu’s total value is some $15 billion — up from a reported $5.8 billion in 2016, when Time Warner — now a part of AT&T — bought the stake. Netflix at the time had a market capitalization of about $41 billion and is currently valued at $152 billion as on Monday’s close.
The move gives Walt Disney Co, which holds a 60 percent stake in Hulu via a joint venture, more control of the company.
Comcast Corp’s NBCUniversal has a 30 percent stake. Based on the joint venture agreement, Disney and Comcast will decide on how they want to allocate the shares bought from AT&T.
It was unclear how the deal could affect content on Hulu in the immediate future. AT&T is preparing to launch its own subscription streaming video service.
Hulu Chief Executive Officer Randy Freer said in a statement that “WarnerMedia will remain a valued partner to Hulu for years to come as we offer customers the best of TV, live and on demand, all in one place.”
AT&T did not respond to a Reuters request for comment on the structure of the deal.
The wireless carrier said it would use the proceeds from the deal to cut down its debt, which stood at $176.5 billion at the end of 2018.
The company had said in November it could consider selling its stake in Hulu and review its non-core assets in 2019.
Disney last week forecast Hulu’s subscribers to reach 40 million to 60 million by fiscal 2024 and become profitable in the United States by either 2023 or 2024.


US intelligence says Huawei funded by Chinese state security: report

Updated 20 April 2019
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US intelligence says Huawei funded by Chinese state security: report

  • The accusation comes at a time of trade tensions between Washington and Beijing
  • Huawei dismissed the allegations

US intelligence has accused Huawei Technologies of being funded by Chinese state security, The Times said on Saturday, adding to the list of allegations faced by the Chinese technology company in the West.
The CIA accused Huawei of receiving funding from China’s National Security Commission, the People’s Liberation Army and a third branch of the Chinese state intelligence network, the British newspaper reported, citing a source.
Earlier this year, US intelligence shared its claims with other members of the Five Eyes intelligence-sharing group, which includes Britain, Australia, Canada and New Zealand, according to the report.
Huawei dismissed the allegations in a statement cited by the newspaper.
“Huawei does not comment on unsubstantiated allegations backed up by zero evidence from anonymous sources,” a Huawei representative told The Times.
The company, the CIA and Chinese state security agencies did not respond immediately to requests for comment.
The accusation comes at a time of trade tensions between Washington and Beijing and amid concerns in the United States that Huawei’s equipment could be used for espionage. The company has said the concerns are unfounded.
Authorities in the United States are probing Huawei for alleged sanctions violations.
Meng Wanzhou, Huawei’s chief financial officer and daughter of its founder, Ren Zhengfei, was arrested in Canada in December at the request of the United States on charges of bank and wire fraud in violation of US sanctions against Iran.
She denies wrongdoing and her father has previously said the arrest was “politically motivated.”
Amid such charges, top educational institutions in the West have recently severed ties with Huawei to avoid losing federal funding.
Another Chinese technology company, ZTE Corp. , has also been at the center of similar controversies in the United States.
US sanctions forced ZTE to stop most business between April and July last year after Commerce Department officials said it broke a pact and was caught illegally shipping US-origin goods to Iran and North Korea. The sanctions were lifted after ZTE paid $1.4 billion in penalties.
Reuters reported earlier this week that the United States will push its allies at a meeting in Prague next month to adopt shared security and policy measures that will make it more difficult for Huawei to dominate 5G telecommunications networks.