Fox Corporation confirmed that it has entered into a definitive agreement to acquire ad-supported streamer Tubi for approximately $440 million.
The acquisition of Tubi, which the company expects to close before June 30, is intended to broaden and enhance Fox’s direct-to-consumer digital reach and engagement. Tubi has 25 million monthly active users who spend more than 160 million hours per month watching content on the service.
Fox said that Tubi will also integrate with and deepen its capabilities in areas including digital advertising, direct-to-consumer interfaces and personalization technology. Tubi will be able to fully use Fox’s advertising and distribution relationships along with its national and local promotional platforms.
Fox said it will continue to run Tubi as an independent service and that it will evaluate opportunities to expand the Tubi offering by potentially using Fox’s existing operations for national and local news, and sports programming.
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“Tubi will immediately expand our direct-to-consumer audience and capabilities and will provide our advertising partners with more opportunities to reach audiences at scale. Importantly, coupled with the combined power of Fox’s existing networks, Tubi provides a substantial base from which we will drive long-term growth in the direct-to-consumer arena,” said Fox CEO Lachlan Murdoch in a statement.
“Fox Corporation’s relationships with advertisers and distribution partners, combined with the company’s dominance in news and sports programming, will help Tubi continue to grow and differentiate itself in the high-growth ad-supported streaming marketplace. I am proud of what the team has already accomplished here at Tubi and we couldn’t be more excited about joining such a fast-moving, entrepreneurial company. We look forward to working together with FOX to accelerate Tubi’s leadership position in the market and bring new competencies to Fox,” said Tubi Founder and CEO Farhad Massoudi in a statement.
Fox sold its stake in Roku to mostly finance the Tubi acquisition, which it said “preserves its balance sheet capacity by essentially exchanging a passively held minority investment for full ownership and control of a leadership position in the free ad-supported streaming market.”
Fox joins many other media conglomerates that have recently bought their way into the growing AVOD streaming market. Last year Viacom (before it merged with CBS) bought Pluto TV for $340 million and earlier this year Comcast acquired Xumo.