Peter Chernin: Here’s My Half-Billion Dollar Hulu Bid
The former president and COO of News Corp (NASDAQ:NWSA) Peter Chernin has bid around $500 million for Hulu, the popular online content streaming service, according to Reuters. Hulu was founded in 2007 with help from Chernin, who sat on its board. The company is currently jointly owned News Corp (NASDAQ:NWS), Walt Disney Co (NYSE:DIS), and Comcast Corp (NASDAQ:CMCSA). However, Comcast has no corporate control of Hulu as a condition of the deal in which it acquired NBC Universal.
Since leaving News Corp, Chernin founded the Chernin Group, which holds stakes in a number of media enterprises in film and television. The group also owns part of Pandora Media Inc, the popular online streaming radio service. After selling its 10% stake of Hulu back to the company a year ago for $200 million (which valued Hulu at $2 billion), Providence Equity Partners invested $200 million in the Chernin Group. Providence Equity Partners originally invested $100 million in Hulu to help start it.
Besides potentially selling Hulu, Disney, and News Corp are considering buying out the other’s stake. A planned sale of Hulu in October 2011 fell through after the bids fell short of Hulu’s $2 billion asking price. The reason why Chernin’s $500 million bid seems so low, according to Bloomberg, is that the deal does not include Hulu’s debts of $330 million and would go up depending on longer media contract terms and more content rights.