Fox has announced plans to acquire US streaming service Tubi for $440 million in cash, funded largely by the sale of its 5 per cent stake in Roku.
Having lost ownership of NOW TV in its sale of Sky, the corporation sought another dedicated streaming service. The ad-supported platform has over 20,000 free titles and 25 million active monthly viewers.
Fox expects the deal to close by the end of June 2020 subject to regulatory approvals and other closing conditions. It plans to continue running Tubi as an independent service under its founder and CEO Farhad Massoudi.
Fox Corporation executive chairman and CEO Lachlan Murdoch said: “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.”
He said that by selling its Roku stake, Fox is “essentially exchanging a passively held minority investment for full ownership and control of a leadership position in the free ad-supported streaming market.”
Massoudi added: “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.”