01:06 PM EST, 01/06/2025 (MT Newswires) -- (Updates to include Fox's response in the eight paragraph.)

Walt Disney ( DIS ) agreed to merge its Hulu + Live TV business with FuboTV ( FUBO ) in a deal that will give the media and entertainment a 70% stake in its streaming peer and settle litigation related to the proposed Venu Sports venture.

The combination will create programming packages that "address a variety of consumer preferences at attractive price points," Disney ( DIS ) and FuboTV ( FUBO ) wrote in a joint statement. Shares of FuboTV ( FUBO ) soared 181% in Monday trade, while Disney's ( DIS ) were 1.1% higher.

The new virtual multichannel video programming distributor, or vMVPD, will be operated by Fubo's existing management team, including Chief Executive David Gandler, under the Fubo name. It will have 6.2 million combined North American subscribers.

"This agreement allows us to scale effectively, strengthens Fubo's balance sheet and positions us for positive cash flow," Gandler said in the statement. "It's a win for consumers, our shareholders, and the entire streaming industry."

Immediately following its merger with Disney's ( DIS ) Hulu + Live TV, Fubo is expected to be well-capitalized and cash-flow positive, according to the companies. Fubo will be governed by a board that is majority appointed by Disney ( DIS ).

The new company will expand both Disney ( DIS ) and Fubo's vMVPD offerings and provide consumers with "more choice and flexibility," said Justin Warbrooke, Disney's ( DIS ) head of corporate development.

As part of the transaction, Fubo agreed to settle all existing litigation related to Venu Sports, the proposed sports streaming platform planned by ESPN ( DIS ), Fox (FOX, FOXA) and Warner Bros. Discovery ( WBD ) . Disney ( DIS ), Fox and Warner Bros. will pay a total of $220 million to Fubo, according to the joint statement from Disney ( DIS ) and Fubo. Disney ( DIS ) will also provide a $145 million term loan to Fubo in 2026.

A Fox spokesperson confirmed the settlement during a call with MT Newswires and said that it plans to "move forward" with Venu Sports. Warner Bros. didn't respond to an emailed request for comment.

The US District Court for the Southern District of New York in August issued a preliminary injunction against the Venu Sports joint venture, citing potential antitrust concerns.

Disney ( DIS ) will enter into a new carriage agreement that enables Fubo to launch its own sports and broadcast service featuring Disney's ( DIS ) sports broadcasting assets, including ABC and a variety of ESPN ( DIS ) channels. Both Fubo and Hulu + Live TV will continue to be available as separate offerings.

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