Hulu has hired Guggenheim Partners to offer advice on a potential sale at the same time that the financial services company is reportedly considering its own bid, three sources told Reuters.
It's not the first time Guggenheim has been on the Hulu payroll. When Hulu considered selling in 2011, it brought Guggenheim Executive Chairman Alan Schwartz on board to advise. That deal never happened because Hulu couldn't find anyone to pay its $2 billion asking price. This time, the streaming video service, jointly controlled by Walt Disney Co.'s (NYSE: DIS) ABC unit and News Corp.'s (Nasdaq: NWSA) Fox Network with non-controlling ownership by Comcast's (Nasdaq: CMCSA) NBCUniversal unit, hopes to have better luck.
Spokespeople from all involved firms declined to comment on the Reuters story, which also made it clear that its sources were speaking anonymously because "the ongoing auction process is private."
Guggenheim, those sources say, could be among those involved in that private process as well, and has established a Chinese wall between its investment banking and asset management arms to remove any conflict concerns. Guggenheim has also supposedly pushed for a more "transparent" bidding process.
Some do not believe Guggenheim can remain unbiased, however. "It's a definite conflict of interest," Ehud Kamar, a professor at the University of Southern California's Gould School of Law, told Reuters. It's also something that's going to happen more often "as financial firms get bigger and bigger."
Guggenheim marks the second potential Hulu bidder following former News Corp. President Peter Chernin, who Reuters reported has bid around $500 million for the property.
Hulu's value could be pegged on public figures the firm has released showing that it has more than 3 million subscribers who pay $7.99 per month for its premium service and that last year it generated $700 million in revenues.
- Reuters reported this story
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