Hulu owners call off auction, plan to invest $750 million

FILE - This Nov. 11, 2009 file screen grab shows the home page of Hulu.com. The on-again, off-again sale of Hulu is off again. The parent companies of ABC, NBC and Fox said Friday that they would stay owners of Hulu, while providing a cash infusion of about $750 million to ensure future growth. The owners had accepted formal bids for the online video service last week, the second time in three years they tried to sell the company. But the announcement Friday suggests the bids were too low. Reports pegged the high end of bidding around $1 billion, which is half of what the online video provider was valued at when the existing owners bought out Providence Equity Partners 10 percent stake for $200 million in April 2012.(AP Photo/Hulu, File)**NO SALES**
FILE - This Nov. 11, 2009 file screen grab shows the home page of Hulu.com. The on-again, off-again sale of Hulu is off again. The parent companies of ABC, NBC and Fox said Friday that they would stay owners of Hulu, while providing a cash infusion of about $750 million to ensure future growth. The owners had accepted formal bids for the online video service last week, the second time in three years they tried to sell the company. But the announcement Friday suggests the bids were too low. Reports pegged the high end of bidding around $1 billion, which is half of what the online video provider was valued at when the existing owners bought out Providence Equity Partners 10 percent stake for $200 million in April 2012.(AP Photo/Hulu, File)**NO SALES**
Posted: July 14, 2013

Hulu L.L.C.'s owners, Comcast Corp.'s NBCUniversal, Walt Disney Co., and Rupert Murdoch's 21st Century Fox Inc., on Friday called off their sale of the video-streaming service and will instead invest $750 million in the company.

The decision ends an auction that attracted bids from suitors including DirecTV, Time Warner Cable Inc., and Peter Chernin with AT&T Inc., people with knowledge of the matter said.

The growing popularity of streaming companies like Netflix and Hulu may have persuaded the owners, all media companies with TV and film libraries, to keep the fast-growing service.

Hulu has 30 million unique monthly visitors, annual revenue that doubled to $690 million last year, and more than four million paying subscribers.

The cash infusion will allow the company to acquire additional programming in competition for subscribers with Netflix and Amazon.com.

The canceled auction wasn't the first time Hulu's owners had a change of heart. They put the site up for sale in June 2011 and called it off in October.

The service never advanced a planned IPO in 2010 that envisioned a $2 billion valuation.

The current auction stemmed from disagreements over Hulu's direction between Disney and Fox, which control the company and had each considered buying the other out. Comcast is barred from an operational role because of conditions placed on its purchase of NBCUniversal.

Suitors this time around were forced to weigh possible restrictions on future streaming rights.

Michael Eisner, former chairman of Disney, predicted this week that a buyer would lose next-day rights to TV shows that the service now enjoys.

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